TS4F03
Management Accounting in SAP
S/4HANA – Academy Part I - part II
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INSTRUCTOR HANDBOOK
SAP Live Class
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Course Version: 14
Course Duration: 10 Day(s)
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Hint
Preparing for Your SAP Live Class
Required Equipment for Your SAP Live Class
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PC or Mac
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Integrated or external web cam
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Headset with integrated mic
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Stable internet connection
You can test if your setup is working correctly by using this link: https://sap.zoom.us/test
We recommend that you connect two monitors to your PC so that you can manage the course content
more efficiently. This will reduce the need for you to switch (alt+tab) between the applications we use in
class.
Getting the Most Out of Your SAP Live Class
Make sure you have setup and thoroughly tested the SAP Live Class environment and resolved any
issues well before the class begins. Refer to the separate instructions that you were sent for setup
instructions and support contact information.
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Keep your web cam activated during the training sessions. You can switch it off during breaks if you
prefer.
Use a headset with an integrated mic to ensure a high-quality audio experience for both you and the
other participants. Laptop speakers and mic produce poor quality sound and introduce background
noise that can disturb the class.
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Make sure you are in a quiet area where you will not be disturbed.
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Be ready to use the mute feature to ensure any background noise does not disturb the class.
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Turn off email, phones, instant messaging tools, and clear other distractions away from your training
area.
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Actively participate and prepare to be called on by name.
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Be patient waiting for a response to your chat messages.
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Always ask the instructor for assistance if you need help with an exercise. Don’t get left behind.
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Be ready to begin class on time so you do not delay the start of each session.
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During breaks, make sure you take the opportunity to get out of your chair and stretch.
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Please raise any concerns relating to the SAP Live Class experience with your instructor at the time
they arise so that they can be quickly addressed.
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Contents
ix
Course Overview
1
Unit 1:
3
11
17
Lesson: Explaining Product Cost Planning
Lesson: Selecting the Right Product Cost Planning Method
Unit 2:
19
25
33
Unit 3:
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83
93
105
110
117
121
125
131
135
139
145
Unit 4:
45 Minutes
20 Minutes
45 Minutes
20 Minutes
40 Minutes
20 Minutes
45 Minutes
Minutes
45 Minutes
Minutes
Product Cost Planning Configuration
Lesson: Explaining the Costing Variant
Lesson: Configuring the Costing Variant
Exercise 6: Display a Costing Variant
Lesson: Explaining the Cost Component Split
Lesson: Configuring the Cost Component Structure
Exercise 7: Display a Cost Component Structure
Lesson: Applying Overhead Costs to a Product
Exercise 8: Calculate Overhead
Lesson: Allocating Process Costs to a Product
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30 Minutes
45 Minutes
Minutes
30 Minutes
45 Minutes
Minutes
45 Minutes
Minutes
25 Minutes
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53
57
65
70
45 Minutes
45 Minutes
Material Cost Estimate Without Quantity Structure
Lesson: Integrating Material Master Records and Product Cost
Planning
Exercise 1: Display a Material Master Record
Lesson: Creating a Single-Level Cost Estimate Without Quantity
Structures
Exercise 2: Create Single Level Unit Cost Estimate
Lesson: Working Efficiently with Single Level Unit Cost Estimates
Exercise 3: Modify Single Level Unit Cost Estimate
Lesson: Creating a Multi-level Material Cost Estimate Without
Quantity Structure
Exercise 4: Create a Multi-level Cost Estimate
Lesson: Maintaining Multi-level Cost Estimates
Exercise 5: Modify a Multilevel Cost Estimate
43
49
45 Minutes
Product Cost Planning Basics
Lesson: Defining Costing Items
Lesson: Understanding Product Cost Planning Basics
34
103
Product Cost Planning Methods
163
Unit 5:
165
187
193
Lesson: Defining the Quantity Structure
Lesson: Determining the Quantity Structure
Exercise 9: Display a Cost Estimate
45 Minutes
45 Minutes
Minutes
203
209
Lesson: Creating Material Cost Estimates with Quantity Structure
Exercise 10: Create a Material Cost Estimate with Quantity
Structure
Lesson: Updating the Material Master
Exercise 11: Update the Standard Price in the Material Master
Lesson: Changing Prices in the Material Master
45 Minutes
Minutes
216
225
235
249
Unit 6:
250
259
265
269
283
Unit 7:
328
337
347
353
364
373
380
385
395
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Additional Costing Functions
Lesson: Using Transfer Control
Exercise 14: Use Transfer Control
Unit 8:
303
327
45 Minutes
Minutes
45 Minutes
Minutes
40 Minutes
10 Minutes
Cost Object Controlling
Lesson: Outline Cost Object Controlling
Unit 9:
60 Minutes
Product Cost Controlling by Period
Lesson: Using a Product Cost Collector
Exercise 15: Create a Product Cost Collector
Lesson: Using a Production Order and Product Cost Collector
Exercise 16: Create a Production Order
Lesson: Performing Preliminary Costing for Product Cost Collector
Exercise 17: Perform Preliminary Costing
Lesson: Performing Simultaneous Costing for Product Cost
Collector
Exercise 18: Post Goods Issue and Confirmation to the
Production Order
Exercise 19: Post Goods Receipts to a Production Order
45 Minutes
20 Minutes
45 Minutes
15 Minutes
45 Minutes
20 Minutes
60 Minutes
15 Minutes
15 Minutes
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301
45 Minutes
Minutes
25 Minutes
Costing Run
Lesson: Using Costing Runs in Product Cost Planning
Exercise 12: Use a Costing Run
Lesson: Analyzing the Results of a Costing Run
Exercise 13: Review the Results of a Costing Run
284
295
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Material Cost Estimate with Quantity Structure
409
Unit 10:
Period-End Closing for Product Cost Controlling by Period
411
415
417
Lesson: Outlining Period-End Closing for a Product Cost Collector
Lesson: Performing Template Allocation
Exercise 20: Perform Template Allocation
45 Minutes
30 Minutes
15 Minutes
423
426
429
434
437
448
457
464
471
Lesson: Performing Revaluation at Actual Prices
Lesson: Performing Actual Overhead Calculation
Exercise 21: Perform Actual Overhead Calculation
Lesson: Calculating Work in Process (WIP)
Exercise 22: Calculate Work in Process
Lesson: Performing Variance Calculation
Exercise 23: Execute Variance Calculation
Lesson: Performing Settlement
Exercise 24: Execute the Settlement of WIP and Variances for
the Product Cost Collector
30 Minutes
30 Minutes
15 Minutes
60 Minutes
15 Minutes
45 Minutes
20 Minutes
45 Minutes
20 Minutes
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viii
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Course Overview
TARGET AUDIENCE
This course is intended for the following audiences:
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Application Consultant
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Project Manager
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Super / Key / Power User
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x
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UNIT 1
Product Cost Planning Methods
Lesson 1
Explaining Product Cost Planning
3
Lesson 2
Selecting the Right Product Cost Planning Method
11
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Explain product cost planning
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Understand material costing without quantity structure
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Understand material costing with quantity structure
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UNIT OBJECTIVES
1
Unit 1: Product Cost Planning Methods
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Unit 1
Lesson 1
3
Explaining Product Cost Planning
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Explain product cost planning
Figure 1: Financial Accounting Learning Journey
Learning Journeys are visual guides, designed to help you complete the learning path for
particular SAP solutions. The easiest way to find learning journeys is to search for SAP
Learning Journeys in your browser.
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SAP S/4HANA Finance Learning Journey
Unit 1: Product Cost Planning Methods
Product Cost Planning Overview
Figure 2: Goals of Product Cost Planning
PCP assists employees in operational decision making for manufactured products by
providing the following detailed information:
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Cost of goods manufactured, and the cost of goods sold
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Calculation of the break-even price for the product
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Comparison of production cost in large versus small lot sizes
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Production cost breakdown and comparison, for example, material costs and wages
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Optimization of the production process
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Production cost by organizational unit
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Manufacturing cost by plant
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Effect of primary costs on production costs
In the SAP S/4HANA application, materials can be valuated with a standard price, which can
be set by a standard cost estimate.
4
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Emphasize the fact that SAP has the capability to handle the costing requirements of the
entire lifecycle. Explain the processes and techniques available in the SAP S/4HANA
application to manage costs throughout a product’s lifecycle.
Lesson: Explaining Product Cost Planning
Product Lifecycle
Different stages of the product lifecycle are as follows:
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Product idea or simulation
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Product design and specification
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After transition to the prototype stage, the first constructive data can be entered in the
form of a bill of material (BOM). During this phase, the need for integration and direct
access to data in logistics increases. The person responsible for Product Cost Planning
creates the data missing from logistics.
Market maturity of product
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At the product design and specification stage, costs can increase as refinements are
made to original specifications.
Prototype of new product
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At the start of the product lifecycle, Product Cost Planning is used to provide initial cost
projections. The projections, which are usually based on existing similar products or
structures, must be delivered quickly. These projections must be flexible and variable to
accommodate the simulated cost projections.
After products attain market maturity, the integration of master data for tangible goods
has a significant impact. At this stage the cost of the product or product range is
monitored periodically at regular intervals and cost shifts are analyzed.
Continuous improvement
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Figure 3: Product Lifecycle
Unit 1: Product Cost Planning Methods
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Improvements in the production process of important products must be reflected by
and analyzed in Product Cost Planning.
Facilitator
Producer
Say:
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-
"We're going to complete a brainstorming and group collaboration activity
now".
Do:
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Assist the instructor with compiling the
results and commenting on them.
"I'd like you to take 2 minutes and write
some responses to the question in your
participant handbook".
Wait for two minutes.
"Now go ahead and enter your ideas in the
chat pod that I've opened for this activity.
Remember to enter only one idea per line".
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-
-
-
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Do:
Explain that the participants should answer each question with as many responses as possible and that each response will be on a separate line in the
chat area.
Remind participants of the rules of brainstorming.
Each brainstorming session should last
45–60 seconds only.
Launch a whiteboard overlay and then
debrief by typing the most common
ideas on the slide and making use of the
annotation tools.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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Lesson: Explaining Product Cost Planning
INTERACTIVE ELEMENT: Chat
1. For five minutes, write some responses to the following question in your participant
handbook:
What are the various stages of the product life cycle?
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Costing Sequence
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Figure 4: Costing Sequence
The different stages of the costing sequence are as follows:
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Product idea stage
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7
Unit 1: Product Cost Planning Methods
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First prototype stage and ready for market stage
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If you plan a new product for which there is no master data in the SAP S/4HANA
application, you can perform initial planning and cost projections using Product
Lifecycle Costing. In this solution, you manually enter the costing items in a
spreadsheet or the cockpit to create a cost estimate. We will examine this process later.
When the first material master data is created in the SAP S/4HANA application and
production planning (PP) is not an SAP module, you can use the material cost estimate
without a quantity structure to manually plan the cost of goods manufactured and the
cost of goods sold for the product. Two methods are available for material cost
estimate planning without a quantity structure. These are unit costing and multilevel
unit costing.
Unit costing allows you to plan the cost per unit of the material without detailing the
cost of each production phase. Multilevel unit costing enables you to plan cost at
assembly level, without requiring production BOMs.
Saturation stage and decline stage
-
When the complete master data (BOM and routing) is available in the system, you can
create a material cost estimate with a quantity structure, which automatically
calculates the cost of goods manufactured and the cost of goods sold from existing
data in logistics, such as BOM and routing.
Costing Methods
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Figure 5: Costing Methods
8
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The circled items in the figure identify the tools which are discussed during the class.
Lesson: Explaining Product Cost Planning
The different costing methods are as follows:
●
Unit costing and multilevel unit costing
In the early stages of the product lifecycle, unit costing and multilevel unit costing are the
ideal costing methods. These methods offer flexibility and efficient data maintenance. You
can refine the cost estimate as more data becomes available.
●
Cost estimate with a quantity structure
When a cost estimate with a quantity structure is created, the system uses master data
from logistics to generate a cost estimate. This method costs individual products
precisely, and provides various analysis options to compare different alternatives.
●
Costing run
Costing runs are used to process mass data. This method is used periodically to cost an
entire product spectrum.
Note:
The costing tool Reference and Simulation Costing was deleted according to the
simplification list. Only if you set your system via migration from SAP ERP system
(brownfield approach) it is available for compatibility reasons.
Tangible and Intangible Goods
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Figure 6: Tangible and Intangible Goods
Tangible goods are physical objects. The characteristics of tangible goods are as follows:
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●
Materials can be produced in-house, subcontracted, or procured externally.
Data for these materials is located in the logistics components Production Planning
(PP) and Materials Management (MM). This data is accessed when the materials are
costed.
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Unit 1: Product Cost Planning Methods
●
Product cost estimates for tangible goods can be used for inventory valuation and
comparison purposes in Cost Object Controlling.
The characteristics of tangible goods are as follows:
●
●
●
Materials can be produced in-house, subcontracted, or procured externally.
Data for these materials is located in the logistics components Production Planning
(PP) and Materials Management (MM). This data is accessed when the materials are
costed.
Product cost estimates for tangible goods can be used for inventory valuation and
comparison purposes in Cost Object Controlling.
Product cost planning is based on various production strategies. The main production
strategies are as follows:
●
Make-to-stock production
Make-to-stock production tries to match production with forecast consumer demand.
●
Make-to-order production
Make-to-order production allows consumers to purchase products that are customized to
their specifications.
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Shipping (packing, storage, quality checking, and so on)
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Telecommunications
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Consulting
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Training
This course introduces intangible goods cost planning using base object costing.
FACILITATED DISCUSSION
What are the goals of Product Cost Planning?
LESSON SUMMARY
You should now be able to:
●
10
Explain product cost planning
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Intangible goods are usually services. Examples of intangible goods are as follows:
Unit 1
Lesson 2
11
Selecting the Right Product Cost Planning
Method
LESSON OVERVIEW
This lesson explains the methodology for selecting the optimum Product Cost Planning (PCP)
method for your requirements.
Business Example
A new forklift that has already been costed using Reference and Simulation Costing is to be
included in the production program. The cost of goods manufactured (COGM) and cost of
goods sold (COGS) must be calculated before you can create the final bill of material (BOM)
and routings. A material master record already exists for the new forklift in the SAP S/4HANA
application; you need to study and understand the costing and accounting views of the
material master. For this reason, you require the following knowledge:
●
An understanding of how to create and display the cost estimate using the different cost
planning methods
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Understand material costing without quantity structure
●
Understand material costing with quantity structure
Material Costing Without Quantity Structure
Figure 7: Material Costing Without Quantity Structure
The material cost estimate without quantity structure costing method is used when a material
master exists for a product, but a bill of material (BOM) and routing do not. For example, you
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An understanding of the various cost planning methods
Unit 1: Product Cost Planning Methods
can use this costing method for products that are still in the prototype phase, but for whom a
cost estimate is required.
You can also use this method for valuating intangible goods such as services for which there
is no BOM or routing. With this method you can carry out a cost estimate for materials even if
the quantity structure data (such as BOMs and routings) is located in a non-SAP Production
Planning system. You create this type of cost estimate in the SAP system using the reference
cost estimate.
Material Costing with Quantity Structure
The material cost estimate with quantity structure costing method is used when a material
master as well as a bill of material (BOM) and routing exist for a product. It is used for
planning costs and setting prices for materials without reference to production orders, for
calculating cost of goods manufactured and cost of goods sold, and for valuating inventory at
standard prices.
LESSON SUMMARY
You should now be able to:
12
●
Understand material costing without quantity structure
●
Understand material costing with quantity structure
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Figure 8: Material Costing With Quantity Structure
Unit 1
13
Learning Assessment
1. The costing results in Product Cost Planning consist of the cost of goods manufactured
only.
Determine whether this statement is true or false.
X
True
X
False
2. Which of the following are stages in a product lifecycle?
X
A Product design and specification
X
B Product idea
X
C Continuous improvement
X
D Saturation
X
E Costing run
3. At the product design and specification phase, costs can increase as refinements are
made to original specifications.
Determine whether this statement is true or false.
X
True
X
False
4. Which of the following is necessary for the material costing without quantity structure
costing method?
Choose the correct answer.
X
A Bill of material
X
B Material master
X
C Bill of trading
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Choose the correct answers.
Unit 1: Learning Assessment
5. You want to introduce a modified variant of an existing product into the market. Which
costing method do you use to generate the cost estimate?
Choose the correct answer.
X
A Reference and Simulation Costing
X
B Material cost estimate with quantity structure
X
C Material cost estimate without quantity structure
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Unit 1
15
Learning Assessment - Answers
1. The costing results in Product Cost Planning consist of the cost of goods manufactured
only.
Determine whether this statement is true or false.
X
True
X
False
Correct! The cost of goods sold is also included in PCP Overview.
2. Which of the following are stages in a product lifecycle?
X
A Product design and specification
X
B Product idea
X
C Continuous improvement
X
D Saturation
X
E Costing run
Correct! The costing run is a process, not a stage of a product, not a stage of a product
lifecycle.
3. At the product design and specification phase, costs can increase as refinements are
made to original specifications.
Determine whether this statement is true or false.
X
True
X
False
Correct! Costs are volatile in the early stages of a product lifecycle.
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Choose the correct answers.
Unit 1: Learning Assessment - Answers
4. Which of the following is necessary for the material costing without quantity structure
costing method?
Choose the correct answer.
X
A Bill of material
X
B Material master
X
C Bill of trading
Correct! You would still require the material master for which you want to perform costing.
5. You want to introduce a modified variant of an existing product into the market. Which
costing method do you use to generate the cost estimate?
Choose the correct answer.
X
A Reference and Simulation Costing
X
B Material cost estimate with quantity structure
X
C Material cost estimate without quantity structure
Correct! When you do not have all the new materials, BOMs, and routings you use material
cost estimate without quantity structure.
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UNIT 2
Product Cost Planning Basics
Lesson 1
Defining Costing Items
19
Lesson 2
Understanding Product Cost Planning Basics
25
●
Explain the purpose of costing items
●
Identify item categories used in Product Cost Planning
●
Explain the purpose of a costing variant
●
Explain the purpose of a costing sheet
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UNIT OBJECTIVES
17
Unit 2: Product Cost Planning Basics
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18
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Unit 2
Lesson 1
19
Defining Costing Items
LESSON OVERVIEW
This lesson explains the purpose of the costing variant for costing items. It also describes the
item categories used in Product Cost Planning (PCP).
Business Example
You want to utilize information available in the SAP S/4HANA application in order to run
realistic cost simulations for planned new products. The cost estimates will help you decide
which new products it makes financial sense to produce. For this reason, you require the
following knowledge:
●
An understanding of the purpose of costing items
●
An understanding of the item categories available for cost planning
●
Explain the purpose of costing items
●
Identify item categories used in Product Cost Planning
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
19
Unit 2: Product Cost Planning Basics
Costing Items
A cost estimate identifies the resources required to produce a product or service. These
costing items can use existing master data and prices from the SAP S/4HANA application,
such as activity prices from Cost Center Accounting (CCA) and material prices from Materials
Management (MM).
Depending on the item category, the detail screen of a costing item contains the following
data:
20
●
Item category (required for each line item)
●
Resource (such as material number or cost center)
●
Work center (for activities processed internally)
●
Plant
●
Cost element
●
Quantity
●
Unit of measure
●
Total price
●
Fixed price
●
Total value
●
Fixed value
●
Currency
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Figure 9: Costing Items
Lesson: Defining Costing Items
Facilitator
Producer
Say:
-
-
"Take five minutes to write down answers in your participant handbook".
"Let me know when you are done by using the green check mark (Agree) status
icon".
Do:
-
-
If required, assign whiteboard permissions.
Assign spaces and whiteboard tools to
participants.
Do:
-
-
-
-
-
If numbers are used, assign numbers to
participants.
Give participants a time limit to complete
the activity.
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Duplication is prohibited.
-
Provide specific instructions for the activity.
Take some time to discuss the results
with participants.
If desired, save the whiteboard results
for later reference or distribution.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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21
Unit 2: Product Cost Planning Basics
INTERACTIVE ELEMENT: Whiteboard
1. Take five minutes to write down answers in your participant handbook.
What data is displayed on the detail screen of a costing item?
.
.
.
.
.
.
.
.
.
Modifiable Item Categories
The following table lists the modifiable item categories:
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Item Category
Your Entry
Determined by System
V (Variable item)
Quantity, price, description,
cost element*
Nothing
T (Text item)
Description
Nothing
E (Internal activity)
Cost center, activity type,
quantity
Price, unit of measure, text,
cost element, value
P (Manual process)
Business process, quantity
Price, unit of measure, text,
cost element, value
M (Material)
Material, plant, quantity
Price, unit of measure, text,
cost element, value
N (Service)
Service, plant, quantity
Price, unit of measure, text,
cost element, value
F (External activity)
Purchasing organization, info Price, unit of measure, text,
record, plant, cost element,
cost element, value
quantity
L (Subcontracting)
Purchasing organization, info Price, unit of measure, text,
record, quantity
cost element, value
Cost Element Source
The system automatically determines a cost element for most costing items, depending on
the item category.
22
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Table 1: Modifiable Item Categories
Lesson: Defining Costing Items
The following table lists the source of the cost elements:
Table 2: Cost Element Sources
Item category
Cost Element Source
Internal activity
Activity type master record
External activity
Your manual entry
Subcontracting
Your manual entry
Overhead
Costing sheet
Manual process costs
Your manual entry
Automatic process costs
Process template
Material
Automatic account determination
Service
Service master
Variable item
Your manual entry
When displaying a cost estimate, only the fields that are ready for input are displayed in the
detail screen section.
Special Item Categories
Duplication is prohibited.
Duplication is prohibited.
Figure 10: Special Item Categories
In addition to the modifiable costing item categories mentioned, there are special costing item
categories as shown in the figure. A short description of these costing item categories is as
follows:
●
Overhead (G):
Overhead costs are not directly related to the costs of production but have a sizeable
effect on the manufacturing costs. In order to allocate this cost the costing sheet
functionality is used.
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23
Unit 2: Product Cost Planning Basics
●
Process costs (X):
You can use the costs for business processes in a cost estimate as either a replacement
for, or supplement to, the traditional method of allocating overhead costs. The process
costs are generally allocated using templates.
●
Raw materials cost estimate (I):
The raw material cost estimate enables you to include delivery costs, allocate overhead
and include additive costs at the material component level even though there are no BOMs
or routings for these. Data for cost calculation of these raw materials is taken from,
Purchasing Info Records.
●
Total items (S):
Total items are used by the system to calculate totals for rows. You can define which rows
will be totalled in a formula. By default, the total row will summarize the values of all rows
above it.
●
Operation items (O):
Operation items transform the values of other rows of the cost estimate using simple
formulas. For example, you can create a formula to summarize rows 1 to 10 of the cost
estimate and add 10% to the result.
Note:
To apply a totals row or formula to the cost estimate, take the following steps:
Duplication is prohibited.
2. Place the cursor on the row where you want the formula to be displayed.
3. Choose the Totals or Formula push button to confirm.
Formulas cannot be longer than 50 characters.
LESSON SUMMARY
You should now be able to:
24
●
Explain the purpose of costing items
●
Identify item categories used in Product Cost Planning
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Duplication is prohibited.
1. On the List screen, select the costing items to which you want to apply a total
or formula.
Unit 2
Lesson 2
25
Understanding Product Cost Planning Basics
LESSON OVERVIEW
This lesson explains the purpose of costing variants and costing sheets for Product Cost
Planning (PCP).
Business Example
●
An understanding of the purpose of the costing variant for Product Cost Planning
●
An understanding of the purpose of creating a costing sheet
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Explain the purpose of a costing variant
●
Explain the purpose of a costing sheet
© Copyright. All rights reserved.
Duplication is prohibited.
Duplication is prohibited.
You are in the process of assessing the cost effectiveness of a new forklift. The new forklift is
an improved version of the existing forklift T–FL00. The new forklift will be produced in
smaller quantities than forklift T–FL00. Improved quality standards require longer production
times and higher costs for purchased parts. You also need to cost a service package or
warranty. At this stage, there is no master data either for the new forklift or the service
package. For this reason, you require the following knowledge:
25
Unit 2: Product Cost Planning Basics
Costing Variant
Figure 11: Costing Variant
Duplication is prohibited.
A costing variant for material cost estimates contains control parameters to determine the
quantity structure automatically and to update the prices in the material master. These
settings contain information such as the prices used by the system to cost materials,
activities, and business processes.
The control parameters contained in the costing variant, and the settings you define, depend
on whether you create a material cost estimate or a base object cost estimate.
Valuation Variant and Costing Type
Figure 12: Valuation Variant and Costing Type
Each costing variant contains a valuation variant and a costing type.
26
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Duplication is prohibited.
Each cost estimate that you create is based on a costing variant.
Lesson: Understanding Product Cost Planning Basics
The valuation variant determines at which price materials, activity types, processes,
subcontracting, and external activities are valued by the system (for example, the latest price
or the average price calculated for the entire fiscal year).
The costing type determines the purpose of the costing, such as base object costing or
material costing, and the price update permitted.
Figure 13: Costing Sheet and Overhead Key
Explain the purpose of the costing sheet and how you can use it can be used to apply
overhead (surcharges). The Product Cost Planning Configuration unit describes the
configuration. You can illustrate the calculation of the overhead against the base.
The parameters for overhead costing are summarized in a costing sheet. Overhead rates are
used to pass on costs to cost centers that do not directly reference the production process.
This way you can, for example, distribute the costs from a warehouse cost center to
production orders for which the material was taken from the relevant warehouse.
More specifically, the costing sheet determines the following parameters:
●
The direct costs to which the overhead is to be applied (calculation base).
●
The conditions under which the overhead is to be calculated (dependency).
●
Whether the overhead is allocated on a percentage or a quantity basis.
●
The percentage amount or the amount per unit (overhead rate).
●
The period of validity for the overhead.
●
Which object (cost center, process, or order) is to be credited and by which cost element.
The overhead key determines the overhead percentage rate which will burden the cost of the
product. You use the overhead key to apply different rates to different groups of products.
You define it in customizing and enter it in the costing sheet.
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27
Duplication is prohibited.
Duplication is prohibited.
Costing Sheet and Overhead Key
Unit 2: Product Cost Planning Basics
LESSON SUMMARY
You should now be able to:
●
Explain the purpose of a costing variant
●
Explain the purpose of a costing sheet
Duplication is prohibited.
Duplication is prohibited.
28
© Copyright. All rights reserved.
Unit 2
29
Learning Assessment
1. Which of the following prices from the SAP S/4HANA application are used by costing
items?
Choose the correct answers.
X
A Activity prices from cost center accounting
X
B Material prices from materials management
X
C Valuated prices from materials management
2. Which of the following data is required for activities processed internally?
X
A Resource
X
B Work center
X
C Bill of material
3. The modifiable item categories detail screen displays only the allowed fields that are ready
for input.
Determine whether this statement is true or false.
X
True
X
False
4. Which of the following items is derived from the process template?
Choose the correct answer.
X
A Internal activity
X
B External activity
X
C Manual process costs
X
D Automatic process costs
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29
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answer.
Unit 2: Learning Assessment
5. The formulas for the special item categories cannot be longer than ____________.
Choose the correct answer.
X
A 25 characters
X
B 50 characters
X
C 100 characters
X
D 150 characters
6. Each cost estimate that you create is based on a costing variant.
Determine whether this statement is true or false.
X
True
X
False
7. Which of the following can you determine from the costing sheet?
30
X
A Purpose of costing
X
B Direct costs to which overhead is to be applied
X
C Master data entries for the application of overhead
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answer.
© Copyright. All rights reserved.
Unit 2
31
Learning Assessment - Answers
1. Which of the following prices from the SAP S/4HANA application are used by costing
items?
Choose the correct answers.
X
A Activity prices from cost center accounting
X
B Material prices from materials management
X
C Valuated prices from materials management
Correct! Costing items use activity and material prices.
2. Which of the following data is required for activities processed internally?
X
A Resource
X
B Work center
X
C Bill of material
Correct! Activity types are assigned to work centers.
3. The modifiable item categories detail screen displays only the allowed fields that are ready
for input.
Determine whether this statement is true or false.
X
True
X
False
Correct! You can only see and enter the fields that are ready for input.
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31
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answer.
Unit 2: Learning Assessment - Answers
4. Which of the following items is derived from the process template?
Choose the correct answer.
X
A Internal activity
X
B External activity
X
C Manual process costs
X
D Automatic process costs
Correct! The process template will provide the automatic process costs.
5. The formulas for the special item categories cannot be longer than ____________.
Choose the correct answer.
X
A 25 characters
X
B 50 characters
X
C 100 characters
X
D 150 characters
6. Each cost estimate that you create is based on a costing variant.
Determine whether this statement is true or false.
X
True
X
False
Correct! You must always define a costing variant.
7. Which of the following can you determine from the costing sheet?
Choose the correct answer.
X
A Purpose of costing
X
B Direct costs to which overhead is to be applied
X
C Master data entries for the application of overhead
Correct! You can see the purpose of costing and any direct costs relevant for application
of overhead costs.
32
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Duplication is prohibited.
Duplication is prohibited.
Correct! They are limited to 50 characters.
UNIT 3
Material Cost Estimate Without
Quantity Structure
Lesson 1
Integrating Material Master Records and Product Cost Planning
Exercise 1: Display a Material Master Record
34
43
Lesson 2
Creating a Single-Level Cost Estimate Without Quantity Structures
Exercise 2: Create Single Level Unit Cost Estimate
49
53
Lesson 3
57
65
Lesson 4
Creating a Multi-level Material Cost Estimate Without Quantity Structure
Exercise 4: Create a Multi-level Cost Estimate
70
79
Lesson 5
Maintaining Multi-level Cost Estimates
Exercise 5: Modify a Multilevel Cost Estimate
83
93
UNIT OBJECTIVES
●
●
Describe the different types of material cost estimates
Discuss the integration between the material master record and product cost planning
(PCP)
●
Create a single-level cost estimate for a material
●
Describe the editing functions within unit cost estimates
●
Reference other cost estimates
●
Create a multi-level material cost estimate without quantity structure
●
Maintain multi-level cost estimates
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33
Duplication is prohibited.
Duplication is prohibited.
Working Efficiently with Single Level Unit Cost Estimates
Exercise 3: Modify Single Level Unit Cost Estimate
Unit 3
Lesson 1
34
Integrating Material Master Records and
Product Cost Planning
LESSON OVERVIEW
This lesson describes the integration between the material master record and Product Cost
Planning.
Business Example
The forklift that you costed earlier, is to be included in the production program. The cost of
goods manufactured (COGM) and cost of goods sold (COGS) must be calculated before you
can create the final bills of material (BOMs) and routings. A material master record already
exists for the new forklift in the SAP S/4HANA application. You need to study and understand
the costing and accounting views of the material master. For this reason, you require the
following knowledge:
Duplication is prohibited.
●
An understanding of the different types of material cost estimates
An understanding of integration between the material master record and Product Cost
Planning
Explain the layout of the material master record. Different views are used to represent a
business department or function control of a material. The accounting and costing views are
the most important views from the product costing perspective. These views are plantdependent. For costing, with the exception of the base unit of measure and the material type,
all other accounting and costing controls or field values can be established at the plant
(valuation area) level. Review all the fields and how they can affect costing.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
●
34
Describe the different types of material cost estimates
Discuss the integration between the material master record and product cost planning
(PCP)
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Duplication is prohibited.
●
Lesson: Integrating Material Master Records and Product Cost Planning
Figure 14: Material Cost Estimate without Quantity Structure
Material costing without quantity structure is designed to cost materials without accessing
bills of material (BOMs) or routings. The costing results can be written to price fields in the
material master.
If BOMs or routings do not exist, you can manually enter the cost items that comprise the
product and valuate them with the cost estimate.
Price selection and overhead calculation are determined automatically and are based on the
valuation variant that is assigned to the costing variant.
You can use material costing without quantity structure in the following situations:
●
When costing and updating prices for new materials
●
When costing materials using non-SAP production planning data
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35
Duplication is prohibited.
Duplication is prohibited.
Material Cost Estimate Without Quantity Structure
Unit 3: Material Cost Estimate Without Quantity Structure
Material Cost Estimates with Quantity Structures
Emphasize that the results of a cost estimate created with quantity structure are identical to
the results of a cost estimate created without quantity structure. The only difference is the
origin of the information. The valuation principles explained in earlier units also apply here.
Explain that the term quantity structure refers to the use of production master data, such as
BOM, routing, and recipe.
The results of a material cost estimate with quantity structure do not differ from those of a
material cost estimate without a quantity structure.
The results are identical from the following costing points of view:
●
Cost component split
●
Itemization
●
Costed multi-level BOM
It is only the method by which you obtain the costing results that differs. Material costing with
quantity structure can determine the product structure and production plans as entered in
logistics, and convert them to structures of the itemization and the cost component split.
36
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Duplication is prohibited.
Figure 15: Material Cost Estimates with Quantity Structures
Lesson: Integrating Material Master Records and Product Cost Planning
Figure 16: Organizational Structures for Material Cost Estimates
The material valuation area is an organizational unit within logistics. You conduct a valuation
of materials for each material valuation area to determine valuation prices and values. You
may valuate material stocks either at plant or company code level.
Material cost estimates are saved with reference to a plant. For example, products that are in
production in more than one plant have a separate cost estimate for each plant.
To value material movements in logistics, the system accesses the costing results. The
valuation area determines the organizational level at which the value of the material is
determined. Each plant used in a material cost estimate must be defined as a valuation area.
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37
Duplication is prohibited.
Duplication is prohibited.
Material Master
Unit 3: Material Cost Estimate Without Quantity Structure
Views in the Material Master
Figure 17: Views in the Material Master
Duplication is prohibited.
The accounting, costing, and material requirements planning (MRP) views are relevant to
costing.
The characteristics of each view are as follows:
●
Accounting view:
-
●
Costing view:
-
●
The costing view contains control parameters for material costing and characteristics
required for Cost Object Controlling (COC).
MRP view:
-
38
The accounting view contains parameters relevant to material valuation, material price
control, and account determination.
The MRP view contains parameters that define the material status in Production
Planning (PP), scrap factors, special procurement, co-product and bulk material
indicators and specifies the production version.
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In costing, the material master is used in the calculation of material costs and is updated with
prices.
Lesson: Integrating Material Master Records and Product Cost Planning
Material Master: Fields Relevant to Costing
The material type determines whether a costing view is allowed for a material. The material
type specifies certain default values that are set in the material master.
Material Master: Default Values
●
Lot size:
-
●
Valuation class:
-
●
The valuation class controls account determination. You determine the consumption
account that also is used as the primary cost element in the itemization.
Origin group as subgroup of a cost element:
-
●
You can use the lot size that you enter in the material master as the default value for
generating the material cost estimate. The lot size can be overwritten in individual
processing. It cannot be overwritten in mass processing.
If you enter an origin group for a material, the combination of origin group and cost
element is updated in the controlling (CO) system. You can define the overhead for
specific material groups, such as input material groups, and the cost components for
specific raw material groups.
Overhead group:
-
The overhead group is the key that groups materials manufactured for the same type of
overhead application, based on the product.
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39
Duplication is prohibited.
Duplication is prohibited.
Figure 18: Material Master: Fields Relevant to Costing
Unit 3: Material Cost Estimate Without Quantity Structure
Material Master: Prices
●
Planned prices 1, 2, and 3:
-
●
Tax-based and commercial prices:
-
●
Planned prices 1, 2 and 3 can be used for reporting and to valuate materials in cost
estimates. You can either enter the planned prices manually, or determine them using a
material cost estimate. If they are determined by a cost estimate, the prices are
updated on the material master using the Price Update function.
You enter tax-based and commercial prices either manually or using the Price Update
function from material cost estimates. An inventory cost estimate can use these prices
for valuation and then update the costing results in the tax-based and commercial
prices fields of the material master of the produced material.
Price control:
-
The price control indicator specifies the price you use to evaluate the inventory of a
material. The available options are standard price and moving average price.
Use the Material Master Display exercise as a demonstration.
40
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Duplication is prohibited.
Duplication is prohibited.
Figure 19: Material Master: Prices
Lesson: Integrating Material Master Records and Product Cost Planning
Facilitator
Producer
Say:
-
"You are going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I will give you five minutes to work with
your partner and then we will summarize
briefly as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
© Copyright. All rights reserved.
41
Unit 3: Material Cost Estimate Without Quantity Structure
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
Discuss how the material master record is used in Product Cost Planning.
Using private chat, take five minutes and discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
.
Duplication is prohibited.
Duplication is prohibited.
42
© Copyright. All rights reserved.
Unit 3
Exercise 1
43
Display a Material Master Record
Note:
This course uses the characters ## as a placeholder for your group number.
Whenever you see ## in an exercise step, replace it with the number that your
instructor assigned to you.
Log on to the SAP Fiori launchpad. Locate the link to the SAP Fiori launchpad by
using the desktop search. Enter the Logon credentials S4F23-## and the
password given to you by your instructor.
Besides working with the SAP Fiori launchpad, it is still possible to work with the
classic SAP GUI, for example, for customizing. On the desktop, choose Start and
then SAP Logon to open the SAP Logon Pad. Logon to system T41 with client 400
and the logon credentials S4F23-## and the password given to you by your
instructor.
You may always use the exercises as a demo.
Business Example
You want to create a cost estimate for a new material. Your engineering department has
created the material master record. You want to gain an overview of what kind of information
is stored in a material master record. You will check the material master for the forklift and
see how a material master data record is structured.
1. To gain an overview about the structure of a material master record, check the material
master for the fork lift, T-FL## that has to be produced. Check the Basic Data, the Sales
Data, the Work Scheduling Data, and the Accounting Data.
Use the following data:
Field
Value
Material number
T-FL##
© Copyright. All rights reserved.
43
Duplication is prohibited.
Duplication is prohibited.
Note:
The starting point for SAP S/4HANA users is the SAP Fiori launchpad with
transactional and analytical apps, as well as a generic SAP HANA search. The tiles
are logically grouped and predelivered in areas. The S4F23 training uses
personalized tile groups according the course content such as Controlling Master
Data, Valuation, and Logistics Master Data. Depending on the authorization and
roles, the user can personalize the launchpad individually.
Unit 3: Material Cost Estimate Without Quantity Structure
Field
Value
Plant
1010
2. What is the material type, base unit of measure, and the material status?
3. Will the material be purchased or manufactured?
4. Which production version does the material use?
5. Which is the valuation class, price unit, and price control for this material?
6. How many price fields are available?
7. Can the item be costed?
8. Can the material use a cost estimate without quantity structure?
9. Does the material have an overhead group?
Duplication is prohibited.
Duplication is prohibited.
44
© Copyright. All rights reserved.
Unit 3
Solution 1
45
Display a Material Master Record
Note:
This course uses the characters ## as a placeholder for your group number.
Whenever you see ## in an exercise step, replace it with the number that your
instructor assigned to you.
Log on to the SAP Fiori launchpad. Locate the link to the SAP Fiori launchpad by
using the desktop search. Enter the Logon credentials S4F23-## and the
password given to you by your instructor.
Besides working with the SAP Fiori launchpad, it is still possible to work with the
classic SAP GUI, for example, for customizing. On the desktop, choose Start and
then SAP Logon to open the SAP Logon Pad. Logon to system T41 with client 400
and the logon credentials S4F23-## and the password given to you by your
instructor.
You may always use the exercises as a demo.
Business Example
You want to create a cost estimate for a new material. Your engineering department has
created the material master record. You want to gain an overview of what kind of information
is stored in a material master record. You will check the material master for the forklift and
see how a material master data record is structured.
1. To gain an overview about the structure of a material master record, check the material
master for the fork lift, T-FL## that has to be produced. Check the Basic Data, the Sales
Data, the Work Scheduling Data, and the Accounting Data.
Use the following data:
Field
Value
Material number
T-FL##
© Copyright. All rights reserved.
45
Duplication is prohibited.
Duplication is prohibited.
Note:
The starting point for SAP S/4HANA users is the SAP Fiori launchpad with
transactional and analytical apps, as well as a generic SAP HANA search. The tiles
are logically grouped and predelivered in areas. The S4F23 training uses
personalized tile groups according the course content such as Controlling Master
Data, Valuation, and Logistics Master Data. Depending on the authorization and
roles, the user can personalize the launchpad individually.
Unit 3: Material Cost Estimate Without Quantity Structure
Field
Value
Plant
1010
a) In the SAP Fiori launchpad, choose the tile Display Material in the tile group Controlling
- Logistics Master Data.
b) In the Initial screen of Display Material, in the Material field, enter T-FL##, and choose
Enter.
c) In the dialog box Select View(s) choose the following views:
●
Basic Data 1
●
MRP 1, 2, 3, 4
●
Accounting 1
●
Accounting 2
●
Costing 1
●
Costing 2
d) Choose Continue (Enter).
Field
Value
Plant
1010
f) Choose Continue (Enter).
2. What is the material type, base unit of measure, and the material status?
a) Look at Basic Data 1.
Material Type: Finished Product (window title) or choose the Information button next
to the Material field. The Material Type is FERT for Finished Product. Choose Back.
Base Unit of Measure: PC
X-Plant Matl Status: [blank]
Note:
Choose the Enter button on your keyboard to navigate through your
chosen views.
3. Will the material be purchased or manufactured?
a) Look at the MRP2 and use the Input Help (F4) for exploring the type of procurement.
Procurement type: E for in-house production.
4. Which production version does the material use?
a) Look at the MRP4.
46
© Copyright. All rights reserved.
Duplication is prohibited.
Duplication is prohibited.
e) In the Organizational Levels dialog box, enter the following data:
Lesson: Integrating Material Master Records and Product Cost Planning
By clicking the button ProdVersions, you can see the Production Version is 0001.
Choose Continue to close the pop-up window.
5. Which is the valuation class, price unit, and price control for this material?
a) Look at Accounting view 1.
Valuation Class: 7920
Price Unit: 1
Prc. Ctrl. : S for Standard price. Close the pop-up window.
6. How many price fields are available?
a) Look at Accounting 1.
Price Fields: Standard and Future
b) Look at Accounting 2.
Price Fields: 3 Tax and 3 Commercial
c) Look at Costing 2.
Price Fields: Future, and 3 Planned Price.
7. Can the item be costed?
a) Look at Costing 1.
Yes, because the Do not cost field is blank.
a) Look at Costing 1.
You will see the indicator: With Qty structure: Yes. However, regardless of the setting,
you can cost a single material with or without quantity structure.
9. Does the material have an overhead group?
a) Look at Costing 1.
Overhead Group: Yes, ZMTO00.
b) Choose the SAP Logo (Navigate to Home Page).
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47
Duplication is prohibited.
Duplication is prohibited.
8. Can the material use a cost estimate without quantity structure?
Unit 3: Material Cost Estimate Without Quantity Structure
LESSON SUMMARY
You should now be able to:
●
●
Describe the different types of material cost estimates
Discuss the integration between the material master record and product cost planning
(PCP)
Duplication is prohibited.
Duplication is prohibited.
48
© Copyright. All rights reserved.
Unit 3
Lesson 2
49
Creating a Single-Level Cost Estimate Without
Quantity Structures
LESSON OVERVIEW
This lesson explains how to create a single-level cost estimate without quantity structures.
Business Example
Engineering Management has decided to do the initial cost analysis based on an existing
material. The cost of goods manufactured (COGM) and cost of goods sold (COGS) must be
calculated before you can create the final bills of material (BOMs) and routings. You will use
material costing without a quantity structure. For this reason, you require the following
knowledge:
●
An understanding of a single-level cost estimate without quantity structures
●
Create a single-level cost estimate for a material
Duplication is prohibited.
Duplication is prohibited.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Single-Level Cost Estimate
Figure 20: Single-Level Unit Costing
To create a single-level cost estimate, enter the material and plant for which the cost estimate
should be created. Choose a costing variant.
© Copyright. All rights reserved.
49
Unit 3: Material Cost Estimate Without Quantity Structure
The costing variant determines the following factors:
●
●
The valuation strategy for costing items
The validity dates for the costing variant and valuation dates for material and activity
prices
If you do not enter a lot size, the system uses the lot size from the material master. A cost
estimate header is automatically created that can be used to change the lot size on the fly and
enter various explanatory texts.
You can enter the costing items manually, or reference and modify a base planning object or
an existing material cost estimate.
When you save the costing items, the calculation of overhead and process costs occurs
automatically. The itemization and cost component split are then available for analysis.
When you save the material cost estimate, the itemization is saved in the database.
Use the Create Single Level Unit Cost Estimate exercise as a demonstration.
Duplication is prohibited.
Duplication is prohibited.
50
© Copyright. All rights reserved.
Lesson: Creating a Single-Level Cost Estimate Without Quantity Structures
Facilitator
Producer
Say:
-
"You are going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I will give you five minutes to work with
your partner and then we will summarize
briefly as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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51
Unit 3: Material Cost Estimate Without Quantity Structure
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
What are the steps involved in estimating single-level unit cost for a material?
Using private chat, take five minutes and discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
.
Duplication is prohibited.
Duplication is prohibited.
52
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Unit 3
Exercise 2
51
Create Single Level Unit Cost Estimate
Business Example
To test unit costing functions, you can copy an existing material and add the production
activities to your new material. According to your engineering department, the new activity is
required to manufacture the assembly. Other components are still used in the product.
Task 1: Create Single Level Unit Cost Estimate
The engineering teams explain that the new forklift will be very similar to an existing forklift.
The existing forklift can be used as a base to create the new material cost estimate. This will
reduce the effort to create the new cost estimate.
1. Create a new cost estimate using the existing material T-FL##.
2. You want to explode the material T-FL## by choosing the Explode Material Cost Estimate
function to reveal the lower level items.
1. Change an item for the additional machine requirements.
The engineering department informs you that the additional machine hours (activity type
1420) are required at work center T-S00 of production plant 1010. To produce 100
forklifts, an additional three hours are required. Enter this new item using the detail screen
(double-click on the input line).
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53
Duplication is prohibited.
Duplication is prohibited.
Task 2: Change an Item for Additional Requirements
Unit 3
Solution 2
52
Create Single Level Unit Cost Estimate
Business Example
To test unit costing functions, you can copy an existing material and add the production
activities to your new material. According to your engineering department, the new activity is
required to manufacture the assembly. Other components are still used in the product.
Task 1: Create Single Level Unit Cost Estimate
The engineering teams explain that the new forklift will be very similar to an existing forklift.
The existing forklift can be used as a base to create the new material cost estimate. This will
reduce the effort to create the new cost estimate.
1. Create a new cost estimate using the existing material T-FL##.
b) On the Multilevel Unit Costing screen, choose on the upper left corner Create →
Create Material Cost Estimate.
c) Enter the following data:
Field
Value
Material
T-FL##
Plant
1010
Costing Variant (Costing Data)
PPC1
Costing Version (Costing Data)
10
Costing Lot Size (Costing Data)
100
d) Click the Dates tab, and then choose the Default Values push button to accept the
default dates or use the Enter button twice.
e) Choose Enter, and accept any warning messages.
2. You want to explode the material T-FL## by choosing the Explode Material Cost Estimate
function to reveal the lower level items.
a) Select row of line item 1 and choose More → Functions → Explode Material Cost
Estimate.
b) On the window Material Explosion, enter the following data:
54
Field
Value
Number of levels
1
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Duplication is prohibited.
Duplication is prohibited.
a) In the SAP Fiori launchpad, choose the tile Create Unit Cost Estimate - Multi in the tile
group Controlling - Valuation.
Lesson: Creating a Single-Level Cost Estimate Without Quantity Structures
Field
Value
Base
100
Material
T-FL##
c) Choose Continue.
d) On the window Selection of material cost ests, choose Current and Execute (F8).
e) On the Select Cost Estimate screen select T-FL## and choose Continue.
f) The message Item(s) copied into clipboard is displayed in the lower left corner.
g) Choose the Paste icon to insert the copied items.
h) Choose Transfer. The cost estimate is saved temporarily.
i) Save your cost estimate and remain in the screen.
Task 2: Change an Item for Additional Requirements
1. Change an item for the additional machine requirements.
a) Double-click your forklift in the costing structure.
b) On the Change Material cost estimate: List screen, double-click item 2.
c) In the Detail Screen: Item 2 dialog box, change and enter the following data in bold:
Field
Value
Item Category
E - Internal Activity
Activity Type
1420
Quantity
3
Unit
H
Work Center
T-S00
Plant of Work Center
1010
d) Choose Confirm (F5) and transfer the data to the costing structure.
e) Choose Save.
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55
Duplication is prohibited.
Duplication is prohibited.
The engineering department informs you that the additional machine hours (activity type
1420) are required at work center T-S00 of production plant 1010. To produce 100
forklifts, an additional three hours are required. Enter this new item using the detail screen
(double-click on the input line).
Unit 3: Material Cost Estimate Without Quantity Structure
LESSON SUMMARY
You should now be able to:
●
Create a single-level cost estimate for a material
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Duplication is prohibited.
56
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Unit 3
Lesson 3
55
Working Efficiently with Single Level Unit Cost
Estimates
LESSON OVERVIEW
This lesson explains how to work with Single Level Unit Cost Estimates. This lesson describes
the tools available to modify the cost estimate and evaluate the results.
Business Example
●
An understanding of various functions to create or enhance a cost estimate
●
An understanding of referencing other cost estimates
●
An understanding of analysis options
Duplication is prohibited.
Duplication is prohibited.
You are assessing the cost effectiveness of a new forklift. The new forklift is an improved
version of the existing truck, and will be produced in smaller quantities. Improved quality
standards entail longer production times and higher costs for purchased parts. You will edit
your current unit cost estimate. At this stage, there is no BOM or routing. For this reason, you
require the following knowledge:
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Describe the editing functions within unit cost estimates
●
Reference other cost estimates
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57
Unit 3: Material Cost Estimate Without Quantity Structure
Figure 21: Create and Change Costing Items
The following screens are used for entering costing items in unit costing:
●
List screen:
The input fields in this screen are user-definable. The screen is available in the following
views:
●
-
View 1: Resources
-
View 2: Texts, variable items, and totals
-
View 3: Simple formulas
Detail screen:
You can use this screen to create or change data in detail. You can access this screen for
the items selected from the list screen by clicking on an icon, or by using the menu option.
You enter an item category for each item in the cost estimate. The item category determines
which data you enter, which data the system reads, and how the system calculates the costs
for the item. The detail screen indicates the permissible item categories, entries, and objects.
58
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Duplication is prohibited.
Cost Estimate Modification
Lesson: Working Efficiently with Single Level Unit Cost Estimates
Enhanced Efficiency
Usually, the system can access existing master data or cost estimates. This is the basis for
the concept of fast copying and editing to produce quick reliable results. The number of
manual entries is reduced to a minimum as per requirement.
When you create base planning objects, adhere to the following guidelines:
●
Use an existing reference, if available, to fill the necessary master data fields.
●
Ensure that text changes and assignment alterations are the only adjustments.
Key Steps: Use List Screen and Editing
Use the list screen filter to reduce the number of items displayed.
To use the list screen filter, perform the following steps:
1. Select one or more columns in the list screen.
2. Choose the Filter icon.
3. Enter the filter requirements.
4. To view all the items again, choose the Delete filter push button.
The procedure to cut, copy, and paste costing items within base planning objects is as
follows:
1. Select the item to cut or copy.
2. Choose the cut or copy icon.
3. Select the position to insert the item.
4. Paste the data from the clipboard.
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Duplication is prohibited.
Duplication is prohibited.
Figure 22: Enhanced Efficiency – Detail Functions
Unit 3: Material Cost Estimate Without Quantity Structure
Note:
You cannot transfer items using a base quantity. Base quantity needs to be “1” for
the transferred item.
Figure 23: Exploding Material Cost Estimates
You need to insert the itemization of an existing material cost estimate in the itemization. To
achieve this, insert the costing items for two units, Gearbox T-FL230, in a single action.
Exploding Material Cost Estimates: Key Steps
To explode the material cost estimates, perform the following steps:
1. Choose the Explode Material Cost Estimate function.
2. Specify the number of levels to be exploded.
3. Specify whether you need to transfer only the material items or all the items.
4. Specify the reference quantity with which you explode the cost estimate.
5. Enter the material.
6. Select a material cost estimate.
7. Copy the costing items to the clipboard.
8. In the List screen, place the cursor in the position where the items need to be inserted.
60
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Duplication is prohibited.
Material Cost Estimates as a Reference
Lesson: Working Efficiently with Single Level Unit Cost Estimates
9. Paste and revaluate.
Note:
Items that are automatically generated by the system (such as overhead and
process costs determined using a template) are lost in revaluation. This applies to
all transfers.
Figure 24: Explanation Facilities
The explanation facilities enable the cost planner to directly access data and information in
the costing environment while remaining in the cost estimate screen.
You can access the explanation facilities in the following ways:
●
By selecting the Info icon in the cost estimate header
●
The unit cost estimate list screen
●
From the information system through the itemization and the costed multilevel bill of
material (BOM)
The facilities that are available depend on the object to be costed.
Use the Modify Single Level Unit Cost Estimate exercise as a demonstration.
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61
Duplication is prohibited.
Duplication is prohibited.
Explanation Facilities
Unit 3: Material Cost Estimate Without Quantity Structure
Facilitator
Producer
Say:
-
-
"We are going to complete a brainstorming and group collaboration activity
now".
Do:
-
Assist the instructor with compiling the
results and commenting on them.
"I would like you to take two minutes and
write some responses to the question in
your participant handbook".
Wait for two minutes
"Now go ahead and enter your ideas in the
chat pod that I have opened for this activity.
Remember to enter only one idea per line".
Do:
-
-
-
-
62
Explain that the participants should answer each question with as many responses as possible and that each response will be on a separate line in the
chat area.
Duplication is prohibited.
Duplication is prohibited.
-
Remind participants of the rules of brainstorming.
Each brainstorming session should last
45–60 seconds only.
Launch a whiteboard overlay and then
debrief by typing the most common
ideas on the slide and making use of the
annotation tools.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
© Copyright. All rights reserved.
Lesson: Working Efficiently with Single Level Unit Cost Estimates
INTERACTIVE ELEMENT: Chat
1. Take five minutes and write some responses to the following question in your
participant handbook:
What are the various functions that help you work efficiently with base planning
objects?
.
.
.
.
.
.
.
.
.
.
Duplication is prohibited.
Duplication is prohibited.
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63
Unit 3: Material Cost Estimate Without Quantity Structure
Duplication is prohibited.
Duplication is prohibited.
64
© Copyright. All rights reserved.
Unit 3
Exercise 3
61
Modify Single Level Unit Cost Estimate
Business Example
Your engineering team has further refined their design of the new forklift. To avoid duplicating
your previous work, you decide to initiate the new cost estimate, by editing the current cost
estimate. To incorporate these changes, you will use the efficiency tools. This will allow you to
quickly make updates to your cost estimate.
Task 1: Create a New Cost Estimate
Your company has decided to provide installation and inspection at the customer location.
You plan various services for the setup and inspection of the new product. Consequently, you
incur costs for the labor at order acceptance. Your travel costs also need to be included.
Therefore, you need to add separate costs for the installation cost estimate.
2. You want to include the costing items for the labor steps in the new cost estimate. Enter
the time for the installations and inspection that cost center 4300 completes. The
duration of time is 1 labor hour (activity type 1410) per forklift.
You also want to include the costing items for the travel time and expense in the new cost
estimate. The travel expense is an all-inclusive price of EUR 1000. Enter the travel costs as
a fixed item, with cost element 6100800. Save the material cost estimate.
Task 2: Reposition the Package
You would like to reposition the installation package in your forklift estimate. To ensure that
your overhead is calculated correctly, it needs to be above the G - Overhead items.
1. Move your installation package to your forklift calculation.
Task 3: Use Reporting Functions
You would like to evaluate your costing information in more detail. To do so, view reporting
functions for your cost estimate.
1. Select your forklift.
Task 4: Determine How To Use the Explanation Tool
Determine how to use the explanation tool.
1. Access the explanation facilities.
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65
Duplication is prohibited.
Duplication is prohibited.
1. Create a new cost estimate using the existing material, Install.
Unit 3
Solution 3
62
Modify Single Level Unit Cost Estimate
Business Example
Your engineering team has further refined their design of the new forklift. To avoid duplicating
your previous work, you decide to initiate the new cost estimate, by editing the current cost
estimate. To incorporate these changes, you will use the efficiency tools. This will allow you to
quickly make updates to your cost estimate.
Task 1: Create a New Cost Estimate
Your company has decided to provide installation and inspection at the customer location.
You plan various services for the setup and inspection of the new product. Consequently, you
incur costs for the labor at order acceptance. Your travel costs also need to be included.
Therefore, you need to add separate costs for the installation cost estimate.
1. Create a new cost estimate using the existing material, Install.
Duplication is prohibited.
b) Select Create → Create Material Cost Estimate and enter the following data:
Field
Value
Material
Install
Plant
1010
Costing Variant (Costing Data)
PPC1
Costing Version (Costing Data)
##
Costing Lot Size (Costing Data)
100
c) Click the Dates tab, and then choose the Default Values push button to accept the
default dates.
d) Choose Enter. Do not exit.
2. You want to include the costing items for the labor steps in the new cost estimate. Enter
the time for the installations and inspection that cost center 4300 completes. The
duration of time is 1 labor hour (activity type 1410) per forklift.
You also want to include the costing items for the travel time and expense in the new cost
estimate. The travel expense is an all-inclusive price of EUR 1000. Enter the travel costs as
a fixed item, with cost element 6100800. Save the material cost estimate.
a) On the Create Unit Cost Estimate: List Screen, enter the following data in the first line:
66
Field
Value
Type
E
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Duplication is prohibited.
a) In the SAP Fiori launchpad, choose the tile Create Unit Cost Estimate - Multi in the tile
group Controlling - Valuation.
Lesson: Working Efficiently with Single Level Unit Cost Estimates
Field
Value
Resource
4300
Plant / Activity
1410
Quantity
150
b) Choose Enter.
c) In Line 2, enter other travel expense using the following data:
Field
Value
Type
V
Quantity
1
Unit of Measure
PC
Description
Travel time and expense
Price Total
1,000
Cost Element
61008000
Price Fixed
1,000
Task 2: Reposition the Package
You would like to reposition the installation package in your forklift estimate. To ensure that
your overhead is calculated correctly, it needs to be above the G - Overhead items.
1. Move your installation package to your forklift calculation.
a) On the Change Unit Cost Estimate: List Screen, double-click your installation package.
b) Select the newly created lines in this installation package and choose Copy.
c) Double-click your forklift calculation and paste those two lines above your overhead
positions (G) by selecting the first line of the G- overhead positions. Choose Paste.
d) Save the estimate. Remain in the screen.
e) Double-click your forklift calculation.
f) Choose Header.
g) Choose Cost of Goods Sold in the cost component view.
Task 3: Use Reporting Functions
You would like to evaluate your costing information in more detail. To do so, view reporting
functions for your cost estimate.
1. Select your forklift.
a) On the Change Unit Cost Estimate: List Screen, choose More → Costing → Print.
b) Choose the Select Layout push button.
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67
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Duplication is prohibited.
d) Press Enter and save your cost estimate. Remain on the costing screen.
Unit 3: Material Cost Estimate Without Quantity Structure
c) In the Choose Layout dialog box, select the layout 1SAP02 Costing Item (Overview).
The total cost is EUR __________ (100 forklifts).
d) Choose the Select layout push button, and select the layout 1SAP01 Item Categories
(Grouped).
The material cost is EUR __________ (100 forklifts).
e) Choose the Select Layout push button, and select the layout 1SAP09 Cost Elements
(Grouped).
The consumption of the semi-finished product is represented by cost element
54300000.
f) Exit the Cost Elements (Grouped) screen by selecting Back.
Task 4: Determine How To Use the Explanation Tool
Determine how to use the explanation tool.
1. Access the explanation facilities.
a) On the Change Unit Cost Estimate: List Screen, select a line item.
b) Choose the Information on Cost Estimate Item push button.
c) In the Explanation Facilities dialog box, select various types of item categories to
demonstrate that navigation choices for the tool change dynamically.
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Duplication is prohibited.
68
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Lesson: Working Efficiently with Single Level Unit Cost Estimates
LESSON SUMMARY
You should now be able to:
●
Describe the editing functions within unit cost estimates
●
Reference other cost estimates
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Duplication is prohibited.
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69
Unit 3
Lesson 4
66
Creating a Multi-level Material Cost Estimate
Without Quantity Structure
LESSON OVERVIEW
This lesson describes multilevel unit costing and its layout. It also explains the three types of
costing results for a material cost estimate.
Business Example
●
An understanding of multilevel cost estimates
●
An understanding of the various layouts of multilevel unit costing
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
70
Create a multi-level material cost estimate without quantity structure
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Duplication is prohibited.
Duplication is prohibited.
The management of your company decides to include the forklift that you costed using
Reference and Simulation Costing in the production program. You must calculate the cost of
goods manufactured (COGM) and cost of goods sold (COGS) before you can create the final
bills of material (BOMs) and routings. You will use material costing without quantity structure.
The engineering department is considering comparing selling the fork truck with or without
the forks. To create a cost estimate for both options, you need to use multilevel unit costing.
For this reason, you require the following knowledge:
Lesson: Creating a Multi-level Material Cost Estimate Without Quantity Structure
Multi-level Cost Estimate
Multi-level unit costing is a highly flexible function that allows the hierarchical structure
editing of multiple materials. Single-level unit costing only supports the editing of a single
material.
Multilevel unit costing can be used in the following scenarios:
●
Scenario 1: New product
-
●
Scenario 2: Similar product
-
●
You want to create new material masters or cost estimates for new materials. As a rule,
you create the structure from top to bottom by making further refinements.
You want to cost a new product that is similar to an existing one. You can copy the
subordinate costing structure to the new product and make changes to the new
(copied) structure.
Scenario 3: Product changes
-
You want to make changes to an existing product. Copy the existing costing structure
and make changes to the copy.
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71
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Duplication is prohibited.
Figure 25: Multi-level Unit Costing – Basic Scenarios
Unit 3: Material Cost Estimate Without Quantity Structure
Multi-level Material Cost Estimate Without Quantity Structure
The prerequisite for creating a multi-level material cost estimate without quantity structure is
a material master with costing view.
To create a multi-level material cost estimate, choose a costing variant.
When a costing variant is selected, the valuation strategy for costing items is established. For
material costing, the costing variant is maintained in customizing. You have to enter the
costing lot size to use it as a base.
A cost estimate header is created automatically.
When you insert (through drag and drop) an existing cost estimate from the worklist, you
specify if you want to insert the original cost estimate or make a copy. If you choose to copy,
any subsequent changes to the copied structure do not affect the original cost estimate.
Enter the missing quantity in the list screen of the unit cost estimate.
If you are going to edit anything from the copied cost estimate, you re-evaluate the whole
structure as any change makes it mandatory to create a new cost estimate.
After saving, the system updates the cost estimate in the database.
72
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Duplication is prohibited.
Duplication is prohibited.
Figure 26: Multi-level Material Cost Estimate Without Quantity Structure
Lesson: Creating a Multi-level Material Cost Estimate Without Quantity Structure
Figure 27: Layout of Multi-level Unit Costing
The screen for multi-level unit costing is divided into the following three areas:
●
Costing structure:
The system can simultaneously display and process a costed multi-level BOM, multiple
material cost estimates (with and without quantity structure) in the costing structure. The
structure enables you to quickly edit a complex hierarchy and provides a clear overview. It
also offers the same analytical possibilities as the costed multi-level BOM.
●
Unit cost estimate or cost estimate header:
For material cost estimates without quantity structure, the system displays the unit cost
estimate list screen. You can also alternate between the cost estimate header and the list
screen. After you make any changes, the system automatically updates the costing
structure.
●
Worklist or detail lists:
The worklist is designed so that frequently-used structures and resources are available to
the cost planner. You can drag and drop substructures and individual costing items from
the worklist to the cost estimate in the costing structure and vice versa. You can also use
this area to prepare reports for analytical purposes or for displaying error logs.
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73
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Duplication is prohibited.
Costing Results
Unit 3: Material Cost Estimate Without Quantity Structure
Facilitator
Producer
Say:
-
-
"We are going to break into groups of
three people to discuss and complete
the following activity".
Do:
-
-
"You will have 15 minutes to work together in the breakout rooms and then we will
meet together in the main classroom".
-
Do:
-
-
-
-
74
-
Assist the instructor by moving between
the various breakout rooms and answering questions regarding the technology
and questions to be discussed.
If desired, archive the individual breakout
room chat and whiteboard pods for immediate discussion in the main classroom and for later reference or distribution.
Broadcast announcements to everyone.
For example, give a two-minute warning
prior to the end of the breakouts.
Describe how to use the audio sub-conferences and refer to this content in the
participant handbook.
Duplication is prohibited.
Duplication is prohibited.
-
Collect the required demographic information, such as job role, prior experience
with the application, and so on, in order
to assign participants to groups.
Assign participants to breakout rooms.
Advise participants about how to contact
the instructor while in the breakout
rooms (that is, private chat and instant
messaging).
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
© Copyright. All rights reserved.
Lesson: Creating a Multi-level Material Cost Estimate Without Quantity Structure
INTERACTIVE ELEMENT: Breakout Rooms
1. What are the areas of the multi-level unit costing screen?
.
.
.
.
.
.
.
.
.
.
Duplication is prohibited.
Duplication is prohibited.
Cost Estimate Results: Itemization
Figure 28: Cost Estimate Results: Itemization
Review the different types of results. Explain that cost elements and origins are mapped to
cost components to retain the type of cost incurred.
You can display and save the costing results as an itemization. The itemization list can include
the cost element assigned to each item.
The itemization provides detailed data about the resources required to produce a product.
The following data is stored for a material:
●
Material and text
●
Plant
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75
Unit 3: Material Cost Estimate Without Quantity Structure
●
Quantity used
●
Price of material
The following data is stored for an internal activity:
●
Cost center and text
●
Quantity used
●
Activity type
●
Price
Figure 29: Cost Estimate Results: Costed Multi-level BOM
The costed multi-level BOM report provides a hierarchical overview of the value added for
each assembly item.
The display of costs for each component (assemblies and input materials) in the costed multilevel BOM is based on the structure and content of the BOM for the costed material.
You can also display other items such as manufacturing activities and overhead costs.
76
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Duplication is prohibited.
Duplication is prohibited.
Cost Estimate Results: Costed Multi-level BOM
Lesson: Creating a Multi-level Material Cost Estimate Without Quantity Structure
Figure 30: Cost Estimate Results: Cost Component Split
The cost component split groups cost elements in cost components. When a multi-level
structure is costed, the system rolls up the cost component split so that the original identity
of the costs from the lower levels is retained for analysis.
For each product, the cost component split provides information about the value of the
produced material (upper level) and the costs of subordinate materials in the BOM (lower
level).
The cost component split is available for material cost estimates with and without quantity
structure.
Use the Create a Multilevel Cost Estimate exercise as a demonstration.
Create a Multi-level Cost Estimate
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77
Duplication is prohibited.
Duplication is prohibited.
Cost Estimate Results: Cost Component Split
Unit 3: Material Cost Estimate Without Quantity Structure
Duplication is prohibited.
Duplication is prohibited.
78
© Copyright. All rights reserved.
Unit 3
Exercise 4
73
Create a Multi-level Cost Estimate
Business Example
Management decides to include the forklift that you have already costed using Reference and
Simulation Costing in the production program. You have to calculate the COGM and COGS
before you can create the final BOMs and routings. Since a material master record already
exists for your new forklift in the SAP S/4HANA application, you will use material costing
without quantity structure, and incorporate the existing material. The engineering department
is considering whether or not to use a steel flywheel instead of a normal one. To create a cost
estimate for both options, you need to use multi-level unit costing.
The engineering department informs you that the new forklift has been defined as material YFL##. The forklift will be produced in plant 1010 in a lot size of 100.
2. You want to include costing items from the existing material T-FL30 in your new forklift YFL##. Add the material T-FL30 to the worklist.
3. Revaluate the costing structure for forklift Y-FL##. The system should indicate the
resulting costing status with a green traffic light.
.
Note:
The system displays a green light as a result, when you choose Header.
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79
Duplication is prohibited.
Duplication is prohibited.
1. Use the multi-level unit costing functions within costing without quantity structure, and
create a material cost estimate for material Y-FL## in plant 1010. Select the costing
variant PPC1 for the simulation and enter 02 as the version. Accept the default dates in
costing variant PPC1.
Unit 3
Solution 4
74
Create a Multi-level Cost Estimate
Business Example
Management decides to include the forklift that you have already costed using Reference and
Simulation Costing in the production program. You have to calculate the COGM and COGS
before you can create the final BOMs and routings. Since a material master record already
exists for your new forklift in the SAP S/4HANA application, you will use material costing
without quantity structure, and incorporate the existing material. The engineering department
is considering whether or not to use a steel flywheel instead of a normal one. To create a cost
estimate for both options, you need to use multi-level unit costing.
The engineering department informs you that the new forklift has been defined as material YFL##. The forklift will be produced in plant 1010 in a lot size of 100.
Duplication is prohibited.
a) In the SAP Fiori launchpad, choose the tile Create Unit Cost Estimate - Multi in the tile
group Controlling - Valuation.
b) Choose Create → Create Material Cost Estimate.
c) On the Multilevel Costing Data tab, enter the following data:
Field Name or Data Type
Value
Material
Y-FL##
Plant
1010
Costing Variant
PPC1
Costing Version
02
Costing Lot Size
1
d) Click the Dates tab and then choose the Default Values push button to accept the
default dates.
e) Choose Enter to open the list screen for the creation of a unit cost estimate.
2. You want to include costing items from the existing material T-FL30 in your new forklift YFL##. Add the material T-FL30 to the worklist.
a) Choose Worklists On in the upper left corner on the Create Unit Cost Estimate: List
Screen.
b) Right-click on the Material Cost Estimate and choose Select Material Cost Estimate.
80
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1. Use the multi-level unit costing functions within costing without quantity structure, and
create a material cost estimate for material Y-FL## in plant 1010. Select the costing
variant PPC1 for the simulation and enter 02 as the version. Accept the default dates in
costing variant PPC1.
Lesson: Creating a Multi-level Material Cost Estimate Without Quantity Structure
c) On the Selection of material cost ests screen, choose T-FL30 as material, Current, and
Execute (F8).
d) Choose the material with status FR by checking the box (if necessary).
e) Expand the forklift FL30 and click on Drivers Cab. so the line is selected. Pull it to your
new forklift Y-FL##. Choose Copy and Continue.
3. Revaluate the costing structure for forklift Y-FL##. The system should indicate the
resulting costing status with a green traffic light.
a) On the Continue Processing Unit Cost Estimate: List Screen, right-click on the costing
structure of the forklift and choose Revaluate Substructure.
b) Select Save to capture your changes. Confirm with Yes.
c) Remain in the screen for the next exercise.
.
Note:
The system displays a green light as a result, when you choose Header.
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Duplication is prohibited.
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81
Unit 3: Material Cost Estimate Without Quantity Structure
LESSON SUMMARY
You should now be able to:
●
Create a multi-level material cost estimate without quantity structure
Duplication is prohibited.
Duplication is prohibited.
82
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Unit 3
Lesson 5
77
Maintaining Multi-level Cost Estimates
LESSON OVERVIEW
This lesson describes the costing structure, global cut and paste functions, global filters, and
worklists for enhanced efficiency.
Business Example
●
An understanding of costing structures
●
An understanding of global functions
●
An understanding of how to maintain a multilevel cost estimate
Duplication is prohibited.
Duplication is prohibited.
The management of your company decides to include the forklift that you costed using
Single-Level Cost Estimate in the production program. The cost of goods manufactured
(COGM) and cost of goods sold (COGS) must be calculated before you can create the final
bills of material (BOMs) and routings. You need to use the worklist functions with multilevel
costing to complete the cost estimate. For this reason, you require the following knowledge:
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Maintain multi-level cost estimates
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83
Unit 3: Material Cost Estimate Without Quantity Structure
Costing Structure
A costing structure displays one or more cost estimates in the form of a multi-level BOM. You
can navigate quickly to the detailed information. The costing structure has the same reporting
facilities as the costed multi-level BOM.
Multi-level unit costing enables you to edit base planning objects and material cost estimates
without a quantity structure.
You can use buttons and context menus to work within the costing structure. The availability
of context menus depends on the item or object concerned. If available, you can access the
context menu by right-clicking the item you wish to edit.
When you start editing, only cost estimates appear in the costing structure. You can also
choose to display all the costing items.
84
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Duplication is prohibited.
Duplication is prohibited.
Figure 31: Costing Structure
Lesson: Maintaining Multi-level Cost Estimates
Enhance Efficiency for Costing Structure
The following functions help you to use the costing structure for enhanced efficiency:
●
Copy:
Select a cost estimate, or part of one, and drag it to the Costing structure icon. The system
prompts you to specify the costing variant and costing version with which it produces the
cost estimate. The system transfers the resources to the new cost estimate and displays
the new cost estimate in the structure.
●
Insertion:
Select a cost estimate, or part of one, and drag it to the required position. The system asks
you if you want to insert the cost estimate as an original or a copy. If you choose copy, the
cost estimate will automatically assume the costing variant and costing version that is
used in the costing structure you are modifying. If you choose original, the cost estimate
retains its current costing variant and costing version. Any changes you make can affect
other areas where this cost estimate is in use.
When you insert a cost estimate, you need to enter the quantity of the material on the unit
cost estimate list screen.
●
Deletion:
The Deletion function deletes an object from the costing structure only. The Deletion
function does not delete the cost estimates from the database.
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85
Duplication is prohibited.
Duplication is prohibited.
Figure 32: Enhance Efficiency for Costing Structure
Unit 3: Material Cost Estimate Without Quantity Structure
Costing Structure Status and Revaluation
Figure 33: Costing Structure Status and Revaluation
Duplication is prohibited.
The Changed status enables the cost planner to see if changes in substructures affect the
higher level materials of the cost estimate after revaluation. A costing structure is consistent
when all status indicators are green.
In the figure, changes have been made to the lowest level. A yellow status in the changes
column indicates that changes have been made. At this stage, you are yet to revaluate the
higher-level structures. After you make changes to lower-level items, the system
automatically sets the red status in the higher-level items to indicate that the system has not
incorporated the results of the changes made.
Revaluation can be performed for the entire structure and substructures. A net change is also
available, which permits only those higher-level structures that are directly affected by the
changes to be revaluated.
After you perform the revaluation, the Changed indicator is set to green for all levels.
The Error status indicates whether there were errors detected during revaluation. If the Error
status is red then there is some problem in the costing item that needs to be investigated.
86
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The costing structure has indicators for Changed and Error statuses.
Lesson: Maintaining Multi-level Cost Estimates
Layouts of Multi-level Unit Costing
The figure shows the flexibility in the layout of the multi-level unit costing screen. The default
screen has the basic layout, which displays only the costing structure.
You can adapt the layout to your requirements at any time during the work session. For
example, when you are making changes to the costing structure you might want to display the
worklist. When you have completed setting up the structure you might switch off the worklist
and enable the detail list.
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87
Duplication is prohibited.
Duplication is prohibited.
Figure 34: Layouts of Multi-level Unit Costing
Unit 3: Material Cost Estimate Without Quantity Structure
Facilitator
Producer
Say:
-
"You are going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I will give you five minutes to work with
your partner and then we will summarize
briefly as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
88
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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Lesson: Maintaining Multi-level Cost Estimates
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
What are the different functions available in the costing structure?
Using private chat, take five minutes and discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
Global Functions
Duplication is prohibited.
Duplication is prohibited.
.
Figure 35: Global Functions
The Cut, Copy, and Paste functions facilitate the transfer of multiple costing items from a
material cost estimate without a quantity structure to another or from one base planning
object to another.
To use the global Cut, Copy, and Paste functions, perform the following steps:
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89
Unit 3: Material Cost Estimate Without Quantity Structure
1. Navigate to the cost estimate whose items you want to transfer.
2. Select the items and choose Cut or Copy.
3. Navigate in the costing structure to the cost estimate in which you want to insert the
items.
4. On the List screen of the cost estimate, go to the line where you want to insert the items
and choose Paste to insert the items from the clipboard.
Note:
The quantities are transferred on a 1:1 basis. The system does not
automatically adjust the quantities based on lot size or other criteria. You have
to manually correct the quantities to match the quantity ratio based on the
cost estimate lot size.
Global Filters
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Duplication is prohibited.
Figure 36: Global Filters
You can use the list screen filter to reduce the number of items displayed.
To set a filter, perform the following steps:
1. Select one or more columns on the list screen.
2. Click the filter icon.
3. Enter the filter requirements.
Only the items fulfilling the requirements are displayed on the screen. If you want to see all
items again, choose Delete filter.
90
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Lesson: Maintaining Multi-level Cost Estimates
When a global filter has been set, it remains until it is deleted, even if you navigate to another
cost estimate in the costing structure.
Worklists
The design of the worklist is such that frequently used structures and resources are available
to the cost planner. You can drag and drop substructures and individual costing items from
the worklist to the cost estimate in the costing structure.
Double-click a resource in the worklist to branch to other data, such as the master data.
The system displays the cost estimates that you select in the worklist as multi-level BOMs.
You can display a multi-level BOM by double-clicking it.
The contents of worklists are organized in folders. You can create private and global folders in
the worklist. Each folder is made up of containers. You can specify whether a container is
allowed to have a specific item category only, such as base planning objects, or whether the
container can contain multiple item categories. If the container becomes too large, you can
either create a new one or convert it to a folder.
Use the "Modify a Multilevel Cost Estimate" exercise as a demonstration.
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91
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Duplication is prohibited.
Figure 37: Worklists
Unit 3: Material Cost Estimate Without Quantity Structure
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Duplication is prohibited.
92
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Unit 3
Exercise 5
85
Modify a Multilevel Cost Estimate
Business Example
You must calculate the COGM and COGS before you can create the final BOMs and routings.
Since a material master record already exists for your new forklift in the SAP S/4HANA
application, you will use multi-level cost estimate to build the quantity structure for the new
forklift model. The engineering department is considering whether or not to use a varnished
cab on the new model instead of a normal one. To create a cost estimate for both options, you
need to use multi-level unit costing. The forklift will be produced in plant 1010 in a lot size of
100.
1. Display the hierarchical structure of your cost estimate by expanding the costing
structure of your forklift. Navigate to the cost estimate for the new forklift Y-FL##.
2. Return to the cost estimate for Y-FL##. Replace the cab T-FL530 with new varnish cab TFV53##. The quantity is unchanged. Transfer the change to the costing structure.
3. Revaluate the costing structure for forklift Y-FL##. A green traffic light should indicate the
successfully changed status.
4. Return to the cost estimate for Y-FL##. Switch from the basic view of the costing items to
the header screen and display the itemization report for the cost estimate.
5. Save the cost estimate.
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93
Duplication is prohibited.
Duplication is prohibited.
Note:
Always choose transfer to move your changes from the itemization on the
right to the cost estimate structure on the left.
Unit 3
Solution 5
86
Modify a Multilevel Cost Estimate
Business Example
You must calculate the COGM and COGS before you can create the final BOMs and routings.
Since a material master record already exists for your new forklift in the SAP S/4HANA
application, you will use multi-level cost estimate to build the quantity structure for the new
forklift model. The engineering department is considering whether or not to use a varnished
cab on the new model instead of a normal one. To create a cost estimate for both options, you
need to use multi-level unit costing. The forklift will be produced in plant 1010 in a lot size of
100.
1. Display the hierarchical structure of your cost estimate by expanding the costing
structure of your forklift. Navigate to the cost estimate for the new forklift Y-FL##.
Duplication is prohibited.
b) Double-click Safety Cage/ Sicherheitszelle (under Drivers Cab/Fahrerkabine). The
cost estimate for the material T-FL5A30 Safety Cage is displayed in the list screen.
Note:
Always choose transfer to move your changes from the itemization on the
right to the cost estimate structure on the left.
2. Return to the cost estimate for Y-FL##. Replace the cab T-FL530 with new varnish cab TFV53##. The quantity is unchanged. Transfer the change to the costing structure.
a) On the Change Unit Cost Estimate: List Screen screen, in costing structure, doubleclick Forklift Y-FL##.
b) Within the list screen for the cost estimate for Y-FL##, replace T-FL530 with TFV53##. Accept any warning messages by pressing Enter.
3. Revaluate the costing structure for forklift Y-FL##. A green traffic light should indicate the
successfully changed status.
a) In the costing structure, right-click Forklift Y-FL## and choose Revaluate Substructure.
b) If the revaluation was successful, the status is changed to green.
4. Return to the cost estimate for Y-FL##. Switch from the basic view of the costing items to
the header screen and display the itemization report for the cost estimate.
a) To display the itemization report go to material Y-FL## in the right screen area.
Choose the Header push button to the right of the Material field.
b) On the Multilevel Unit Costing screen, in the Costs tab, choose the Itemization push
button.
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a) On the Multilevel Unit Costing screen, right-click Forklift Y-FL## and choose Expand
subtree.
Lesson: Maintaining Multi-level Cost Estimates
5. Save the cost estimate.
a) Choose Save.
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Duplication is prohibited.
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95
Unit 3: Material Cost Estimate Without Quantity Structure
LESSON SUMMARY
You should now be able to:
●
Maintain multi-level cost estimates
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Duplication is prohibited.
96
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Unit 3
89
Learning Assessment
1. The material cost estimate without quantity structure automatically explodes and
valuates logistical structures.
Determine whether this statement is true or false.
X
True
X
False
2. Which of the following material master views are relevant to costing?
X
A Accounting
X
B Costing
X
C Plant stock
X
D MRP
X
E Forecasting
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answers.
3. Standard price is always equal to the standard cost estimate.
Determine whether this statement is true or false.
X
True
X
False
4. The purpose of designing material costing without a quantity structure is:
Choose the correct answers.
X
A To cost materials without accessing routings
X
B To cost materials without accessing bills of material
X
C To cost materials by accessing bills of material
X
D To cost materials by accessing routings
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97
Unit 3: Learning Assessment
5. When can you use material costing without a quantity structure?
Choose the correct answers.
X
A When costing and updating prices for new materials
X
B When costing and updating prices for raw materials
X
C When costing using SAP production planning data
X
D When costing using non-SAP production planning data
6. List and Details screens are used for entering costing items in unit costing.
Determine whether this statement is true or false.
X
True
X
False
7. If you make a copy of the material cost estimate from the worklist, any changes in the
copied structure do not affect the original cost estimate.
X
True
X
False
8. What is the function of cost component split?
Choose the correct answer.
X
A It groups cost elements in cost components when a multi-level structure is costed.
X
B It provides an overview of the cost elements in cost components.
X
C It allows you to save the cost elements in cost components.
X
D It allows you to delete the cost elements in cost components.
9. When you revaluate the costing structure of a base planning object, what does the yellow
status indicate?
Choose the correct answer.
98
X
A A warning
X
B An error
X
C Changes accepted
X
D Information
© Copyright. All rights reserved.
Duplication is prohibited.
Duplication is prohibited.
Determine whether this statement is true or false.
Unit 3
91
Learning Assessment - Answers
1. The material cost estimate without quantity structure automatically explodes and
valuates logistical structures.
Determine whether this statement is true or false.
X
True
X
False
Correct! Without a quantity structure, there are no logistical structures to explode.
2. Which of the following material master views are relevant to costing?
X
A Accounting
X
B Costing
X
C Plant stock
X
D MRP
X
E Forecasting
Correct! Only the plant stock and forecasting views do not have settings that affect
costing.
3. Standard price is always equal to the standard cost estimate.
Determine whether this statement is true or false.
X
True
X
False
Correct! It depends on the stage of the costing process.
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99
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answers.
Unit 3: Learning Assessment - Answers
4. The purpose of designing material costing without a quantity structure is:
Choose the correct answers.
X
A To cost materials without accessing routings
X
B To cost materials without accessing bills of material
X
C To cost materials by accessing bills of material
X
D To cost materials by accessing routings
Correct! You use it without a BOM and routing.
5. When can you use material costing without a quantity structure?
Choose the correct answers.
X
A When costing and updating prices for new materials
X
B When costing and updating prices for raw materials
X
C When costing using SAP production planning data
X
D When costing using non-SAP production planning data
6. List and Details screens are used for entering costing items in unit costing.
Determine whether this statement is true or false.
X
True
X
False
Correct. List and Details screens are used for entering costing items in unit costing.
7. If you make a copy of the material cost estimate from the worklist, any changes in the
copied structure do not affect the original cost estimate.
Determine whether this statement is true or false.
X
True
X
False
Correct! Changes affect only the copied version.
100
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Duplication is prohibited.
Duplication is prohibited.
Correct! It is used for be products with new materials and non-SAP plan data.
Unit 3: Learning Assessment - Answers
8. What is the function of cost component split?
Choose the correct answer.
X
A It groups cost elements in cost components when a multi-level structure is costed.
X
B It provides an overview of the cost elements in cost components.
X
C It allows you to save the cost elements in cost components.
X
D It allows you to delete the cost elements in cost components.
Correct! The cost component split displays the different cost elements in reference to the
relevant cost component they belong to.
9. When you revaluate the costing structure of a base planning object, what does the yellow
status indicate?
X
A A warning
X
B An error
X
C Changes accepted
X
D Information
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answer.
Correct! The yellow status indicates there is a warning.
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101
Unit 3: Learning Assessment - Answers
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Duplication is prohibited.
102
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UNIT 4
Product Cost Planning
Configuration
Lesson 1
Explaining the Costing Variant
105
Lesson 2
Configuring the Costing Variant
Exercise 6: Display a Costing Variant
110
117
Lesson 3
Explaining the Cost Component Split
121
Configuring the Cost Component Structure
Exercise 7: Display a Cost Component Structure
125
131
Lesson 5
Applying Overhead Costs to a Product
Exercise 8: Calculate Overhead
135
139
Lesson 6
Allocating Process Costs to a Product
145
UNIT OBJECTIVES
●
Explain the costing variant
●
Configure a costing variant
●
Describe the purpose of the cost component split
●
Configure the cost component structure
●
Explain the concept of overhead
●
Describe the structure of a costing sheet
●
Describe activity-based costing
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103
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Duplication is prohibited.
Lesson 4
Unit 4: Product Cost Planning Configuration
●
Explain the purpose of a template
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Duplication is prohibited.
104
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Unit 4
Lesson 1
97
Explaining the Costing Variant
LESSON OVERVIEW
This lesson provides an overview of the costing variant and its purpose.
Business Example
Your company requires you to give cost estimates using various valuation strategies and
methods of indirect cost allocation, such as overhead sheets and process costs. Your task is
to determine how the costing variant controls costing results. For this reason, you require the
following knowledge:
●
An understanding of the costing variant
●
An understanding of the purpose of the costing variant
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Explain the costing variant
Duplication is prohibited.
Duplication is prohibited.
●
Costing Variant Overview
Figure 38: Costing Variant Overview
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105
Unit 4: Product Cost Planning Configuration
Present this graphic as a reference for all the controls that are passed to the cost estimate
through the costing variant. Do not use this graphic to describe controls such as the date
control and reference variant. Use the figure as a reference tool for participants.
Explain that the costing variant is the most important element that controls the preparation
of the cost estimate. Explain that the figure shows all the settings that the costing variant
controls.
Explain that the costing variant determines the costed object and the use of the cost
estimate. Also, explain that a specific costing variant is used to create a product standard
cost estimate. Explain that another type of costing variant is used during the actual order
process to control how the actual costs of the order are collected. In this example, an object
is a material cost estimate for planning purposes. Another object is an order that will collect
actual costs. For controlling purposes, a costing variant manages both objects.
Another setting that you need to highlight is the use of the costing variant to determine an
appropriate bill of material (BOM) and routing. Use an example to explain that there are
multiple manufacturing methods (routings) available to produce the same product. When
you cost an item for planning, you need to be able to select the routings automatically.
Introduce the cost component layout. Explain that the cost component layout is used to
organize the components, production activities, and overhead surcharges in buckets of
material costs, machine costs, labor costs, production overheads, and sales overheads.
When you create a cost estimate, it is always linked to a costing variant that contains all the
information required to execute a material cost estimate.
You define and check costing variants in Customizing for Product Cost Planning (PCP).
The costing variant for base object costing contains only the parameters for the costing type
and valuation variant.
106
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Duplication is prohibited.
Duplication is prohibited.
Mention that the figure shows additional settings, but to review each setting at this point
would be premature.
Lesson: Explaining the Costing Variant
Purpose of the Costing Variant
Depending on the purpose of the cost estimate, you can create various results for the same
material by making multiple costing variants with various settings for costing type, valuation
variant, dates, and quantity structure determination.
To make technical changes to the quantity structure, you can create a modified, standard
cost estimate and compare it to the standard cost estimate. To value a technical change with
the current prices, you can create a current cost estimate.
The purposes of various cost estimates are as follows:
●
Standard cost estimate
-
●
Modified standard cost estimate
-
●
Modified standard cost estimate is the valuation of the current quantity structure with
planned prices and costing of material during the fiscal year to analyze cost
developments.
Current cost estimate
-
●
Standard cost estimate is the valuation of the planned quantity structure with planned
prices and calculation of standard prices for the valuation of S-price materials.
Current cost estimate is the valuation of the current quantity structure with current
prices and costing of materials during the fiscal year to analyze cost developments.
Inventory cost estimate
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107
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Duplication is prohibited.
Figure 39: Purpose of the Costing Variant
Unit 4: Product Cost Planning Configuration
-
Inventory cost estimate is the valuation of the actual quantity structure with tax-based
and commercial prices and establishment of valuation approaches for inventory
valuation.
Facilitator
Producer
Say:
-
-
"We are going to complete a brainstorming and group collaboration activity
now".
Do:
-
Assist the instructor with compiling the
results and commenting on them.
"I would like you to take two minutes and
write some responses to the question in
your participant handbook".
Wait for two minutes
Duplication is prohibited.
Duplication is prohibited.
"Now go ahead and enter your ideas in the
chat pod that I have opened for this activity.
Remember to enter only one idea per line".
Do:
-
-
-
-
-
108
Explain that the participants should answer each question with as many responses as possible and that each response will be on a separate line in the
chat area.
Remind participants of the rules of brainstorming.
Each brainstorming session should last
45–60 seconds only.
Launch a whiteboard overlay and then
debrief by typing the most common
ideas on the slide and making use of the
annotation tools.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
© Copyright. All rights reserved.
Lesson: Explaining the Costing Variant
INTERACTIVE ELEMENT: Chat
1. Take five minutes and write some responses to the following question in your
participant handbook:
What is the purpose and role of costing variants in the creation of a cost estimate?
.
.
.
.
.
.
.
.
.
.
●
Duplication is prohibited.
Duplication is prohibited.
LESSON SUMMARY
You should now be able to:
Explain the costing variant
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109
Unit 4
Lesson 2
100
Configuring the Costing Variant
LESSON OVERVIEW
This lesson describes the components of the costing variant and shows how to configure a
costing variant.
Business Example
●
An understanding of the components of the costing variant
●
An understanding of how to configure the costing variant
Duplication is prohibited.
Duplication is prohibited.
Your company requires you to produce cost estimates for various purposes using various
valuation strategies and methods of indirect cost allocation, such as overhead sheets and
process costs. Your task is to determine how the costing variant controls costing results. For
this reason, you require the following knowledge:
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Configure a costing variant
Costing Variant Components
Figure 40: Costing Variant: Costing Type
110
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Lesson: Configuring the Costing Variant
The costing type specifically identifies the object and end use of the cost that is calculated.
Provide examples for the various costing types and explain that they are the single
controlling factor that determines what can be costed.
Facilitator
Producer
Say:
-
-
"We are going to complete a brainstorming and group collaboration activity
now".
Do:
-
Assist the instructor with compiling the
results and commenting on them.
"I would like you to take two minutes and
write some responses to the question in
your participant handbook".
Wait for two minutes
Duplication is prohibited.
Duplication is prohibited.
"Now go ahead and enter your ideas in the
chat pod that I have opened for this activity.
Remember to enter only one idea per line".
Do:
-
-
-
-
-
Explain that the participants should answer each question with as many responses as possible and that each response will be on a separate line in the
chat area.
Remind participants of the rules of brainstorming.
Each brainstorming session should last
45–60 seconds only.
Launch a whiteboard overlay and then
debrief by typing the most common
ideas on the slide and making use of the
annotation tools.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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111
Unit 4: Product Cost Planning Configuration
INTERACTIVE ELEMENT: Chat
1. Take five minutes and write some responses to the following question in your
participant handbook:
What is the role played by the costing type of the costing variant in Product Cost
Planning?
.
.
.
.
.
.
.
.
.
.
The costing type controls the following parameters of the costing variant:
●
Price updates:
You specify the prices that are updated in the material master with the results of the cost
estimate. For example, the standard price in the material master can only be updated by a
costing variant with the standard price update. You always use legal valuation except when
updating in multiple valuation.
●
Save with date key:
You specify whether the cost estimate should be saved with a date in its key. You have the
following options:
-
Without date
-
With date
-
With start of period
For the standard cost estimate, you must update automatic costing with the, With Start of
Period indicator. This ensures that the results of the standard cost estimate can be used
as the standard price for that period.
For the other costing types, you can update the costing results with the, With Date
indicator, for example. In this case the current date becomes part of the key. This ensures
that creating a cost estimate on a different date will not delete previous cost estimates.
●
Basis for overhead calculation:
For this, you enter a cost component view. The cost component view indicates which
portion of the cost components are included in tax-based and commercial inventory
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Costing Type: Parameters
Lesson: Configuring the Costing Variant
valuation. The system creates an itemization for each cost component view. This
itemization lists the individual items that were entered into the cost estimate.
●
Partner cost component split:
Partner cost component splits are business units that are part of the value-added chain.
You can define a partner on a multi-dimensional basis from the organizational units such
as plant, company code, profit center, and business area.
Figure 41: Costing Variant: Valuation Variant
Review business scenarios to illustrate why a customer may want to use various prices for
cost estimates. The capability to locate cost information for materials is determined by the
valuation variant, which is assigned to the costing variant. The figure displays the various
price fields in the material master record that can be accessed and the sample search
strategies that can be applied. Explain that the first price field that contains a value is used
based on search sequence.
The valuation variant determines the prices that are used to value component materials,
activity types, processes, subcontracting, and external activities.
The valuation variant searches the various price sources listed for each strategy. The price
sources are searched in the sequence in which they are entered in the strategy. The price that
is first located from the strategy is selected for the cost estimate.
Valuation Variant: The Methods
The valuation variant determines the prices that are used to value different components in the
following ways:
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Costing Variant: Valuation Variant
Unit 4: Product Cost Planning Configuration
●
●
●
To value purchased materials, assembly materials without a valid bill of material (BOM)
and routing, or when creating cost estimates without quantity structure, the valuation
variant selects the price from either the material master record or from the purchasing
data.
To value activity types and processes, the valuation variant selects the price from either
Cost Center Accounting or from Activity-Based Costing. You enter whether a planned or
the actual version is used to determine the price in the valuation variant.
To value an externally processed activity, the valuation variant selects the price from either
the purchasing information record or from the routing. The routing is available only when
costing is done with quantity structure.
Figure 42: Costing Variant: Date Control
Discuss the notes listed on each folio. Use the folio Purpose of the Costing Variant to review
the fact that different costing variants can have different settings for costing types and
valuation variants, thereby allowing cost estimates for the same product to access different
information stored in the system for different purposes.
In costing, date control can be used to create the quantity and value structures based on
various dates.
The date control specifies the following information:
●
For material costing with quantity structure:
-
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The period of validity of the cost estimate
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Costing Variant: Date Control
Lesson: Configuring the Costing Variant
●
-
The date on which the quantity structure is determined (quantity structure date)
-
The date on which the quantity structure is valued (valuation date)
For material costing without quantity structure:
-
The period of validity of the cost estimate
-
The date on which costing items are valued (valuation date)
Date Control
The date control determines the dates that are proposed by the system for costing, and
whether these dates can be changed.
To calculate variances in Cost Object Controlling (COC) based on the cost estimate, you
ensure that the cost estimate is valid in the periods for which variances are to be calculated.
Similarly, to value scrap or work-in-process with the results of the standard cost estimate,
you ensure that the cost estimate is valid in the periods pertaining to the variances or work-inprocess calculation.
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Costing Variant: Further Settings
Figure 43: Costing Variant: Further Settings
The following rules and control parameters are included in the costing variant:
●
Quantity structure
The quantity structure specifies whether the lot size is to be passed on to the cost
estimate. This specification is necessary only for cost estimates with a quantity structure
and in sales order costing.
●
Additive costs
Additive costs specifies the material costs that you can manually enter in a unit cost
estimate and then add to an automatic cost estimate with quantity structure.
●
Update
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Unit 4: Product Cost Planning Configuration
Update specifies whether saving is permitted for the costing variant. If saving is permitted,
the system always saves a cost component split. It is recommended that you also save the
itemization and the error log. Without the itemization, you cannot display costed multilevel BOMs or itemization reports.
●
Assignments
You can maintain the following settings and assignments of the costing variant:
●
-
Cost component structure
-
Costing version
-
Cost component split in controlling area currency
-
Cross company costing
Error management
The costing variant determines whether a log is created during costing.
Effects of Entries in the Error Management Field
Error Management
Effect
0 (Messages online)
Messages are displayed individually in the
status bar. The messages are not logged.
1 (Collect and save messages / mail active)
Messages are logged and can be sent to the
employees responsible for correcting them.
The log can be saved.
2 (Collect and save messages)
Messages are logged. The log can be saved.
3 (Collect messages only)
Messages are logged. The log cannot be
saved.
Use the "Display a Costing Variant" exercise as a demonstration.
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Table 3: Effects of Entries in the Error Management Field
The following table provides an overview of the effects of entries in the error management
field.
Unit 4
Exercise 6
107
Display a Costing Variant
Business Example
Your company is required to produce cost estimates for various purposes using various
valuation strategies and costing types. You need to determine how the configuration of the
costing variant controls this. You are also responsible for reviewing the configuration of the
cost component split. For this reason, you need to display a costing variant.
Task 1: Display an Existing Costing Variant
1. Go to product costing with quantity structure and display costing variant PPC1.
3. Check the prices in the material master that can be updated by a cost estimate that uses
this costing type.
Task 2: Compare Costing Types and Variants
1. Compare this costing type to the costing types for the tax inventory (costing type 10) and
for a modified cost estimate (costing type 12). Which prices in the material master can be
updated by a cost estimate that uses these costing types?
2. What are the differences in the date control parameters that are referenced in costing
variants PPC1 and PPC2? Costing variant PPC1 uses date control PC01 and costing variant
PPC2 uses date control PC05.
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2. Which costing type is assigned to this costing variant?
Unit 4
Solution 6
108
Display a Costing Variant
Business Example
Your company is required to produce cost estimates for various purposes using various
valuation strategies and costing types. You need to determine how the configuration of the
costing variant controls this. You are also responsible for reviewing the configuration of the
cost component split. For this reason, you need to display a costing variant.
Task 1: Display an Existing Costing Variant
1. Go to product costing with quantity structure and display costing variant PPC1.
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b) On the Change View “Costing Variants”: Overview screen, select the row for costing
variant PPC1.
c) Choose Goto → Details.
2. Which costing type is assigned to this costing variant?
a) On the Change View “Costing Variants”: Details screen choose Costing Type.
The costing type assigned to this costing variant is 01 Standard Cost Est. (Mat.).
3. Check the prices in the material master that can be updated by a cost estimate that uses
this costing type.
a) Choose the Costing Type button.
b) On the Change View “Costing types”: Details screen, the Price Update tab identifies the
price update in the material master. Standard Price is selected for this costing type.
c) Choose Back twice to return to the Customizing menu.
Task 2: Compare Costing Types and Variants
1. Compare this costing type to the costing types for the tax inventory (costing type 10) and
for a modified cost estimate (costing type 12). Which prices in the material master can be
updated by a cost estimate that uses these costing types?
a) To define costing types, in customizing choose Controlling → Product Cost
Controlling → Product Cost Planning → Material Cost Estimate with Quantity
Structure → Costing Variant: Components → Define Costing Types.
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a) To define costing variants, on the SAP Easy Access Menu screen in system T41, choose
Tools → Customizing → IMG → Execute Project or use transaction code SPRO and
choose Enter. Select SAP Reference IMG and follow the path Controlling → Product
Cost Controlling → Product Cost Planning → Material Cost Estimate with Quantity
Structure → Define Costing Variants.
Lesson: Configuring the Costing Variant
b) On the Change View “Costing types”: Overview screen, select the row for costing type
10.
c) Choose the Details button.
d) On the Change View “Costing types”: Details screen, you can see that costing type 10
allows update of the tax-based price.
e) Go back to the Change View “Costing types”: Overview screen.
f) Deselect the row for costing type 10 and select the row for costing type 12.
g) Choose the Details button.
h) On the Change View “Costing types”: Details screen, you can see that costing type 12
does not allow the update of any material master prices.
i) Choose Back twice to return to the Customizing menu.
2. What are the differences in the date control parameters that are referenced in costing
variants PPC1 and PPC2? Costing variant PPC1 uses date control PC01 and costing variant
PPC2 uses date control PC05.
a) To define date control, in customizing choose Controlling → Product Cost
Controlling → Product Cost Planning → Material Cost Estimate with Quantity
Structure → Costing Variant: Components → Define Date Control.
c) Go back to the Change View “Date Control”: Overview screen.
d) Deselect the row for date control PC01 and select the row for date control PC05.
e) Choose the Details button.
The date control parameters have different default values.
f) Choose Back twice to return to the Customizing menu.
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b) On the Change View “Date Control”: Overview screen, select the row for date control
PC01, choose the Details button, and have a look at the default values.
Unit 4: Product Cost Planning Configuration
LESSON SUMMARY
You should now be able to:
●
Configure a costing variant
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Unit 4
Lesson 3
111
Explaining the Cost Component Split
LESSON OVERVIEW
This lesson explains the purpose of the cost component split. It describes the various views of
the results screen of material cost estimates and the cost component structure.
Business Example
Your company requires cost estimates for various purposes using various valuation strategies
and methods of indirect cost allocation, such as overhead sheets and process costs.
You also need to maintain the cost component split. For this reason, you require the following
knowledge:
●
An understanding of the purpose of the cost component split
●
An understanding of the various analysis of material cost estimate results
●
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
Describe the purpose of the cost component split
Purpose of Cost Component Split
Figure 44: Purpose of Cost Component Split
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Unit 4: Product Cost Planning Configuration
Explain that a cost component structure is assigned to a costing variant to organize the
original costs of production, materials, and overheads in a grouping of costs. These individual
buckets are called cost components. This cost component breakdown is crucial for providing
information to other areas of the system, such as profitability analysis.
In the cost rollup process, the cost data for low-level components is passed on to the costing
results of the next-highest material. The purpose of a cost rollup is to ensure that the cost
estimate of the higher-level material includes the cost of goods manufactured (COGM), such
as material and production costs, of all materials in a multi-level bill of material (BOM). This
rollup is achieved by assigning the costs in a cost estimate to cost components.
Cost components are established by grouping together various cost elements. Grouping cost
elements provides transparency to the types of costs of a product, such as material, activity
types, or overheads.
When a multi-level BOM is costed, the costs are rolled up. The cost components of the cost
component split are passed up in the hierarchy to the cost estimate of the higher-level
material.
For each material, the cost component split provides the following information:
●
Information about the value addition of the material (upper level)
●
Information about the costs of the subordinate materials (lower level)
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Views of Material Cost Estimate Results
Figure 45: Views of Material Cost Estimate Results
Describe the purpose of views that act as filters based on the origin of costs.
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A maximum of 120 cost fields can be rolled up in a cost component split. A cost component
can carry fixed and variable costs.
Lesson: Explaining the Cost Component Split
A cost component view consists of a combination of cost components based on various
characteristics. The cost component view creates a filter in the information system reports so
that only data assigned to the view is displayed.
You can display up to five views as the initial costing result in the cost estimate header. You
assign these views to the cost estimate in the Settings menu in the cost estimate header.
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Example: Cost Component Split by View
Figure 46: Example: Cost Component Split by View
Views available for material costing result in the following forms:
●
Cost component split
●
Itemization
●
Costed multi-level BOM
How to View a Cost Component Split in a Material Cost Estimate
1. In the cost estimate header for T–FL20, highlight the various cost component views
available for report selection.
2. Explain that these viewing options are available at the costing detail screen level.
3. Highlight the various totals for COGM and costs of goods sold (COGS). Also, show how to
modify the itemization report to display the cost components for COGM and COGS.
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Unit 4: Product Cost Planning Configuration
LESSON SUMMARY
You should now be able to:
●
Describe the purpose of the cost component split
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Unit 4
Lesson 4
114
Configuring the Cost Component Structure
LESSON OVERVIEW
This lesson explains the purpose of the primary cost component split.
Business Example
Your company requires cost estimates for various purposes using various valuation strategies
and costing types. You need to determine how the configuration of the costing variant
controls this. Also, you are responsible for reviewing the configuration of the cost component
split. For this reason, you require the following knowledge:
●
An understanding of how to configure the cost component structure
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Configure the cost component structure
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Duplication is prohibited.
●
Cost Component Structure
Figure 47: Customizing: Cost Component Structure
The folio provides an overview of the customizing tasks required to organize costs in the
appropriate cost component “bucket”. Each material is assigned to a cost element through
account determination. Each activity is assigned to a cost element through the activity type
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Unit 4: Product Cost Planning Configuration
master record. Overhead costs and process costs are also assigned to cost elements. These
cost elements function as channels to move this value information through controlling. To
organize cost components, you need to assign the appropriate cost element(s) to the
appropriate cost component. If required, you can subdivide a cost element using an
additional value, the origin. This is required when controlling needs a further level of definition
with a cost element than that required by financial accounting. Use the origin rather than add
accounts to the general ledger and complicate the account determination procedures.
Also review the assignment of a cost component to cost of goods manufactured (COGM) or
sales and administration. This assignment is extremely important in providing the correct
value for inventory valuation and margin analysis.
Cost components divide costing results in groups of material costs, machine costs, personnel
costs, production costs, overhead, and external activities.
Cost elements are assigned to cost components in the cost component structure.
For each cost component, determine the following information:
The various views of the cost estimate or reports of the information system in which the
costs appear.
●
The cost component group to which the cost component is assigned.
●
Whether the costs are rolled up, that is, whether they appear in higher-level assemblies.
●
Whether the costs are included in the standard price or inventory price of the material.
●
●
Whether the cost component is relevant to inventory and cost of goods manufactured
(COGM).
Whether the cost component should contain a total amount or a fixed or variable split.
A cost component structure is assigned to each costing variant.
You can also assign various cost component structures to each company code and plant.
For standard cost estimates (costing type 01), only one cost component structure is
permitted for each company code. A cost component structure must be used for crosscompany code cost estimates.
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●
Lesson: Configuring the Cost Component Structure
Primary Cost Component Split
If the primary cost component split is activated and the primary costs for the cost center
activity prices are from a different cost component structure than the component split for
the product, it may be necessary to map the cost components together. In the folio, the cost
component structure used in Cost Center Accounting (CCA) uses two cost components for
utilities (energy), but it is not a good idea to have that breakdown in Product Cost Planning
(PCP). It is possible to merge the two energy cost components together to form one cost
component. This is necessary only if the primary cost component split is activated and an
alternative cost component layout was used during the planning process.
Caution:
Currently, the primary cost component split Y2 is not active. You can activate
it during your demo, and create a new cost estimate to demonstrate the
results. If you do not activate the primary layout, you can display the current
cost estimate for T-FL##, plant 1010, and costing variant PPC1.
To create a primary cost component split, perform the following tasks:
●
●
●
Assign a cost component structure in the controlling (CO) version in cost center and
process cost planning.
Determine the prices through planned price iteration.
Define a cost component structure for the primary cost component split of Product Cost
Planning.
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Figure 48: Purpose of Primary Cost Component Split
Unit 4: Product Cost Planning Configuration
●
Define a transfer structure for the transfer of cost components in cost centers and
Activity-Based Costing to the cost components of the primary cost component split in
Product Cost Planning.
For example, there are three cost components in Cost Center Accounting (CCA) for wage
groups X, Y, and Z. In Product Cost Planning (PCP), only the cost component for the wages is
required. The transfer structure enables you to transfer cost components X, Y, and Z to
wages.
When you create a material cost estimate, you can decide whether the system creates a cost
component split only for the COGM, or the primary cost component split, or whether both
primary costs and COGM splits are created simultaneously. You make this choice when you
assign the costing variants and enter the cost component structures for the main and
auxiliary cost component splits.
How to Configure a Primary Cost Split
Set-up and assign the primary cost component split.
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Caution:
Currently, the primary cost component split Y2 is not active. You can activate
it during your demo, and create a new cost estimate to demonstrate the
results. If you do not activate the primary layout, you can display the current
cost estimate for T-FL##, plant 1010, and costing variant PPC1.
a) To define cost component structure, in customizing choose Controlling → Product
Cost Controlling → Product Cost Planning → Basic Settings for Material Costing →
Define Cost Component Structure.
b) On the Change View “Cost Component Structure”: Overview screen, select the row for
Cost Component Structure Y2.
c) In the dialog structure, double-click Assignment: Cost Component - Cost Element
Interval.
d) In the dialog structure, double-click Assignment Organiz. Units - Cost Component
Structure and demonstrate the assignment of the cost component layouts to the
primary and auxiliary columns.
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1. The activation and use of the primary cost component split is controlled in customizing by
the cost component layout. Review the configuration of the primary cost component split.
Use layouts 101 and Y2. Layout Y2 is selected as the primary cost component, which
causes the primary cost elements to be transferred from Organizational Management
(OM). Both the traditional and primary split should be active. For the assignment of cost
component layout, there is now an additional column to assign another layout for the split
that has the cost components separated by the primary cost element. Review the cost
element assignments to the two cost component layouts. Either the primary cost
component split or the cost component split for the COGM can be designated as the main.
The remaining cost component split can then be designated as the auxiliary. Both are
accessible from the standard cost component report and can be transferred to
Profitability Analysis (PA).
Lesson: Configuring the Cost Component Structure
e) Display the cost estimate for T-FL##. The costing header displays the cost component
views. Select the cost component report. In the report display, choose the cost
component split icon and switch between the layouts.
Use the exercise, Display a Cost Component Structure, as a demonstration.
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129
Unit 4: Product Cost Planning Configuration
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130
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Unit 4
Exercise 7
117
Display a Cost Component Structure
Business Example
Your company requires cost estimates for various purposes using various valuation strategies
and costing types. You need to determine how the configuration of the costing variant
controls this. Also, you are responsible for reviewing the configuration of the cost component
split.
Task 1: Explore the Cost Component Structure
1. Go to the details screen of costing variant PPC1 and use the Print Preview function to
display all the control parameters for this costing variant.
2. From the print preview, determine which cost component layout is assigned to this
costing variant for the main cost component split (in plant 1010).
4. Exit the display of the costing variant and call up the documentation for defining the cost
components.
5. From the documentation, determine how many cost components containing full costs can
be created.
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3. Which cost elements are assigned to cost component 101 of this cost component layout
(chart of accounts YCOA)?
Unit 4
Solution 7
118
Display a Cost Component Structure
Business Example
Your company requires cost estimates for various purposes using various valuation strategies
and costing types. You need to determine how the configuration of the costing variant
controls this. Also, you are responsible for reviewing the configuration of the cost component
split.
Task 1: Explore the Cost Component Structure
1. Go to the details screen of costing variant PPC1 and use the Print Preview function to
display all the control parameters for this costing variant.
b) On the Change View “Costing Variants”: Overview screen, select the row for PPC1
costing variant and choose the Details button.
c) On the Change View “Costing Variants”: Details screen, choose the Print Preview
button at the right of the costing variant description.
2. From the print preview, determine which cost component layout is assigned to this
costing variant for the main cost component split (in plant 1010).
a) On the Check Costing Variant screen, scroll to Cost component struc. assignments.
Cost component layout Y1 Product Costing is assigned to all plants through the
wildcard character “++++”.
3. Which cost elements are assigned to cost component 101 of this cost component layout
(chart of accounts YCOA)?
a) Cost elements:
From Cost Element
To Cost Element Origin
Cost Component
51100000
51100000
101 Direct Material
94344000
94344000
101 Direct Material
94345000
94345000
101 Direct Material
4. Exit the display of the costing variant and call up the documentation for defining the cost
components.
a) To define cost component structure, in Customizing, choose Controlling → Product
Cost Controlling → Product Cost Planning → Basic Settings for Material Costing →
Define Cost Component Structure.
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a) To define costing variant, in customizing choose Controlling → Product Cost
Controlling → Product Cost Planning → Material Cost Estimate with Quantity
Structure → Define Costing Variant.
Lesson: Configuring the Cost Component Structure
5. From the documentation, determine how many cost components containing full costs can
be created.
a) The cost components are listed in a cost component structure that can contain up to
120 cost components (cost fields).
You can create up to 120 cost components that contain variable costs.
For cost components that contain full costs, the system creates a second cost field
internally for fixed costs. You can create a maximum of 60 cost components for full
costs.
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133
Unit 4: Product Cost Planning Configuration
LESSON SUMMARY
You should now be able to:
●
Configure the cost component structure
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134
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Unit 4
Lesson 5
121
Applying Overhead Costs to a Product
LESSON OVERVIEW
This lesson describes the concept of overhead costs and costing sheets.
Business Example
Your company wants to apply overhead to the product cost. You need to review the structure
of a costing sheet and Customizing settings that need to be made for overhead application.
You need to determine the elements of a costing sheet, verify the assignment of the costing
sheet to a valuation variant, create a cost estimate, and review the overhead calculation. For
this reason, you require the following knowledge:
●
An understanding of the concept of overhead
●
An understanding of the structure of a costing sheet
●
Explain the concept of overhead
●
Describe the structure of a costing sheet
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
Overhead Costs
Figure 49: Overhead Costs
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135
Unit 4: Product Cost Planning Configuration
Explain the basic structure of the costing sheet and how it is organized to identify direct
costs, indirect costs, and the totals for cost of goods manufactured (COGM) and cost of
goods sold (COGS). Mention that there is no inherent logic provided with a costing sheet. The
costing sheet is structured to recognize direct costs and indirect costs. There is no
recognition within the costing sheet of details such as item category. The control and
organization are based on cost elements and origin groups.
Overhead costing is one of the methods to allocate indirect costs to cost estimates. Overhead
costing applies a percentage or quantity-based fixed amount to a specified cost base. To
determine overhead, you use the direct costs that were posted to the order as a basis for
distributing indirect costs. In the manufacturing industry, for example, direct costs are usually
labor and material costs.
The rules to apply overhead are summarized in the overhead costing sheet.
Figure 50: Costing Sheet in Detail
Explain the definition of the costing sheet, beginning with the calculation base. Explain that
the base defines cost elements that are used to recognize a category of direct costs such as
direct material costs. The origin group is useful if only specific types of materials in a cost
element should be considered as the surcharge base. A good example of this is warehousing
overhead.
Automatic account determination may use the same cost element to recognize purchased
material consumption, but various types of purchased materials may require expensive
warehousing, such as items that require a climate-controlled environment or refrigeration.
To apply the premium warehousing expenses back to those materials, the origin group
should be used to locate the specific items for base calculation. The base can further be
defined as total cost, only fixed costs or variable costs, with the cost element range.
The overhead (or surcharge) key defines the rate of overhead to be applied against the value
calculated in the base. The rate can be defined as a percentage of input costs or as an
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Costing Sheet
Lesson: Applying Overhead Costs to a Product
absolute value of input quantity. Quantity-based surcharges are a good method of applying
machine overhead, because most machine overhead costs such as maintenance are
incurred as a result of operating time and not operating expense. Explain that the overhead
key can be defined using various dependencies, such as plant, company code, order type, or
overhead key.
Remind participants that the overhead key is derived from the overhead group, which is
found in the material master of the product being produced. This is a good method to change
the overhead applied based on the product that is manufactured.
For example, two products are manufactured. Product A has an inspection operation defined
within its routing, so that quality inspection costs are recognized through a direct activity
allocation. Product B is not inspected during production, but only after receipt in the
warehouse. Inspection costs for product B can be considered overhead. By constructing a
dependency for the overhead key assigned to product B, the system has to apply inspection
surcharges to product B and not to product A.
Review fields in the three basic components of the costing sheet. Explain that the costing
sheet should be sufficiently flexible to support all the products manufactured within a single
company code, because it is possible to use only one costing variant for standards, per
company code, per period.
The basic components of the costing sheet are as follows:
●
Calculation base:
You can combine cost elements in base rows. You can also split cost elements by origin
such as raw materials with origin XYZ only. Also, you can divide the calculation base as
fixed and variable costs.
●
Overhead:
You calculate overhead on the calculation base. You can define the overhead percentage
so that it differentiates among planned costs, actual costs, and area of validity based on
specific fields. You can also allocate quantity-based overhead such as USD 100 for every
30 pieces.
●
Credit:
You assign a credit key to each overhead line in the costing sheet. The amount of the
overhead is credited to a cost center, business process, or order under a secondary cost
element. The cost element is important in Product Cost Planning (PCP) because it controls
overhead costs. You can specify the percentage of the overhead that is fixed costs.
Use the "Calculate Overhead" exercise as a demonstration.
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The credit defines the secondary cost element for the credit of the overhead calculation. This
cost element is then mapped to the cost component structure to define the overheads that
are considered COGM and the overheads that are considered sales and administration. It
also defines an overhead cost center, an overhead order, or a business process to receive the
credit posting during actual production. It is also possible to define the percentage of the
calculated surcharge value that should be considered fixed costs. If this is not defined, it uses
the same split between fixed and variable as determined for the base.
Unit 4: Product Cost Planning Configuration
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Unit 4
Exercise 8
123
Calculate Overhead
Business Example
Your company wants to apply overhead to the product cost. You need to review the structure
of a costing sheet and the customizing settings that need to be made for this method of
overhead application. In addition, you need to determine the elements of a costing sheet and
assign the costing sheet to a valuation variant. You need to calculate overheads to
successfully create a cost estimate.
Review the calculation of the overhead surcharge during cost estimate creation.
Task 1: Determine a Costing Sheet
The costing sheet is automatically determined during the creation of a cost estimate. Using
customizing, determine the costing sheet that is selected for a cost estimate created using
the costing variant PPC1.
1. Determine the valuation variant assigned to costing variant PPC1.
Task 2: Identify Information from the Costing Sheet
The costing sheet consists of the calculation base, the overhead percentage, and the receiver
of the overhead credit. The base can be defined by cost element, and if necessary, subdivided
by origin.
1. From customizing, determine the following for the costing sheet 1010PP, controlling area
A000.
2. Determine the cost element range of the calculation base for the material overhead.
3. Determine the material overhead surcharge rate for controlling area A000, overhead type
1, and OH key ZMTO00.
4. In order to apply different overhead rates based on the product being produced, the
overhead key can be assigned to an overhead group for a material. Where is the overhead
group specified for a material?
5. Check the cost element and cost center specified to receive the credit for the calculated
material overhead.
6. Determine the surcharge rate for the administrative overhead for controlling area A000.
7. Check the cost element and cost center specified to receive the credit for the calculated
administrative overhead.
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2. Determine the costing sheet assigned to this valuation variant.
Unit 4: Product Cost Planning Configuration
8. Using cost component layout Y1 and chart of accounts YCOA, determine the cost
component group that the cost element for administrative overhead is assigned to.
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Unit 4
Solution 8
125
Calculate Overhead
Business Example
Your company wants to apply overhead to the product cost. You need to review the structure
of a costing sheet and the customizing settings that need to be made for this method of
overhead application. In addition, you need to determine the elements of a costing sheet and
assign the costing sheet to a valuation variant. You need to calculate overheads to
successfully create a cost estimate.
Review the calculation of the overhead surcharge during cost estimate creation.
Task 1: Determine a Costing Sheet
The costing sheet is automatically determined during the creation of a cost estimate. Using
customizing, determine the costing sheet that is selected for a cost estimate created using
the costing variant PPC1.
a) To define costing variants, in Customizing, choose Controlling → Product Cost
Controlling → Product Cost Planning → Material Cost Estimate with Quantity
Structure → Define Costing Variants.
b) On the Change View “Costing Variants”: Overview screen, select the row for PPC1
costing variant and choose the Details button.
c) On the Change View “Costing Variants”: Details screen, you can see that the valuation
variant is Planned Valuation: Mat.
2. Determine the costing sheet assigned to this valuation variant.
a) On the Change View “Costing Variants”: Details screen, choose the Valuation Variant
button.
b) On the Change View "Valuation Variants": Overview screen select the Overhead tab.
The costing sheet for Finished and Semi-finished Materials is Costing Sheet Planning DE.
The costing sheet for Material Components is Costing Sheet Planning - DE.
Task 2: Identify Information from the Costing Sheet
The costing sheet consists of the calculation base, the overhead percentage, and the receiver
of the overhead credit. The base can be defined by cost element, and if necessary, subdivided
by origin.
1. From customizing, determine the following for the costing sheet 1010PP, controlling area
A000.
a) To define costing sheets, in Customizing, choose Controlling → Product Cost
Controlling → Product Cost Planning → Basic Settings for Material Costing →
Overhead → Define Costing Sheets.
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1. Determine the valuation variant assigned to costing variant PPC1.
Unit 4: Product Cost Planning Configuration
2. Determine the cost element range of the calculation base for the material overhead.
a) On the Change View “Costing sheets”: Overview screen, select the row for costing
sheet 1010PP.
b) In the dialog structure, double-click Costing sheet rows.
c) Select the row for base Y001.
d) In the dialog structure, double-click Base.
e) In the Set Controlling Area dialog box, enter A000 and choose the Continue button.
f) On the Change View “Base”: Overview screen, check the cost element range.
The cost element range is 54300000 to 54300000 and the cost element group is
1200_CE.
3. Determine the material overhead surcharge rate for controlling area A000, overhead type
1, and OH key ZMTO00.
a) Return to the Change View “Costing sheets rows”: Overview screen and select the row
for overhead key C010.
b) In the dialog structure, double-click Overhead rate. The overhead rate is 3%.
The overhead group is assigned in the costing view of the material master record.
5. Check the cost element and cost center specified to receive the credit for the calculated
material overhead.
a) Return to the Change View “Costing sheets rows”: Overview screen and select the row
for the credit key Y10.
b) In the dialog structure, double-click Credit.
c) In the Set Controlling Area dialog box, enter A000 and choose the Continue button.
d) On the Change View “Credit”: Overview screen, check the cost element and cost center
value.
The cost element is 94111000 and the cost center is 10101201.
6. Determine the surcharge rate for the administrative overhead for controlling area A000.
a) Return to the Change View “Costing sheets rows”: Overview screen and select the row
containing the overhead key C013.
b) In the dialog structure, double-click Overhead rate.
c) On the Change View “Overhead rate”: Overview screen, check the surcharge rate. The
surcharge rate is 7.5%.
7. Check the cost element and cost center specified to receive the credit for the calculated
administrative overhead.
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4. In order to apply different overhead rates based on the product being produced, the
overhead key can be assigned to an overhead group for a material. Where is the overhead
group specified for a material?
Lesson: Applying Overhead Costs to a Product
a) Return to the Change View “Costing sheets”: Overview screen and select the row
containing the credit key Y40.
b) In the dialog structure, double-click Credit.
c) In the Set Controlling Area dialog box, enter A000 and choose the Continue button.
d) On the Change View “Credit”: Overview screen, check the cost element and cost center
value.
The cost element is 94114000 and the cost center is 10101101.
8. Using cost component layout Y1 and chart of accounts YCOA, determine the cost
component group that the cost element for administrative overhead is assigned to.
a) To define cost component structure, in Customizing, choose Controlling → Product
Cost Controlling → Product Cost Planning → Basic Settings for Material Costing →
Define Cost Component Structure.
b) On the Change View “Cost Component Structure”: Overview screen, select cost
component structure Y1.
c) In the dialog structure, double-click Assignment: Cost Component – Cost Element
Interval.
d) For cost component structure Y1 and chart of accounts YCOA, cost elements
94113000 and 94114000 are assigned to cost component group 305 Admin Sales
Overhead.
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Unit 4: Product Cost Planning Configuration
LESSON SUMMARY
You should now be able to:
●
Explain the concept of overhead
●
Describe the structure of a costing sheet
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Unit 4
Lesson 6
129
Allocating Process Costs to a Product
LESSON OVERVIEW
This lesson describes activity-based costing and explains how to work with templates.
Business Example
Your company requires cost estimates to be produced for various purposes, using various
valuation strategies and methods of indirect cost allocation, such as overhead sheets and
process costs. You have to determine whether to use activity-based costing and origin-based
allocation of overhead. For this reason, you require the following knowledge:
●
An understanding of activity-based costing
●
An understanding of how to allocate process costs
●
Describe activity-based costing
●
Explain the purpose of a template
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
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Unit 4: Product Cost Planning Configuration
Activity-Based Costing
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Explain the purpose of Activity-Based Costing and provide a few business examples of
indirect costs that can be allocated more accurately on the basis of a statistical value such as
the number of sales orders, credit checks, purchase orders, or goods receipts for a material.
Explain that the purpose is to accurately account for indirect costs based on a specific cost
driver. Activity-Based Costing is a more accurate method than the smoothing method of
overhead allocation using the costing sheet. It requires more analysis and planning to
determine significant overhead costs and how they can be accurately applied to a product.
This section explains how to use activity-based costing and the technical aspects of template
allocation in Product Cost Planning (PCP). The objective is to help you decide whether
activity-based costing and the origin-based allocation of overhead blocks is the right method
for your company to use.
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Figure 51: Activity-Based Costing
Lesson: Allocating Process Costs to a Product
Activities and Aims
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Figure 52: Activities and Aims
The characteristics associated with activity-based costing are as follows:
●
●
●
Overhead transparency
-
Use of resources by processes
-
Quantity-based allocation of overhead
Increased efficiency
-
Use of capacity of indirect areas
-
Constant monitoring of internal processes
-
Interface management on a process-oriented basis
Accurate costing through origin-based allocation of internal activities
The aims of activity-based costing are as follows:
●
Reduction in overhead through optimization of processes
●
Increase in profitability
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Unit 4: Product Cost Planning Configuration
Cost Parts
Figure 53: Cost Parts
Material costing with quantity structure can allocate cost parts that are not contained in the
bill of material (BOM) or routing.
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148
●
Identifying overhead blocks and their costs.
●
Identifying causal origin-based relationships with products that use these overhead blocks.
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The two main reasons that necessitate allocation of cost parts not contained in the BOM or
routing are as follows:
Lesson: Allocating Process Costs to a Product
Figure 54: Business Process
Introduce the term operative Activity-Based Costing and the terminology of process costs.
The process can carry a price similar to an activity price, which can be applied to a product
cost.
By using organization management allocation methods, the process receives costs that it
can pass on to products. Operative Activity-Based Costing is an excellent method of
allocating significant indirect costs such as indirect labor for warehousing, sales, and
shipping, or quality management.
A business process is a process or an activity within a company that uses resources and
activities from one or more cost centers. The business process is one of the master data
objects used in activity-based costing and it is a measurement for output.
Like cost centers, business processes can be planned on cost accounting lines. The system
can calculate a price for the output quantity of a business process. To determine the price,
the system uses an allocation cost element stored in the business process master.
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Business Process
Unit 4: Product Cost Planning Configuration
Figure 55: Creating the Template
A process template can control the application of process costs. The template is linked to a
type of cost driver to determine the amount of indirect costs to allocate to a product. The
cost drivers for a process template can be located in various sources. It can use statistical
key figures, Logistics Information System (LIS), and other sources, to determine the
appropriate process values. The process template can include multiple processes or even
multiple process templates to allocate as many indirect costs as appropriate. Provide a few
business examples such as warehousing material handling costs per movement or
movements between different work centers for each operation.
For each process identified in a process template, logic can be defined to determine if a
process is allocated to a product and how to calculate the quantity of cost drivers that will
determine the amount of indirect cost to apply to the product. The quantity formula can read
values from the material master or order (BOM or routing) to determine the number of
movements and, if necessary, the amount of time (duration of order to determine storage
costs). The process template can be defined to use functions to determine various results for
various circumstances.
The process templates are assigned to the overhead sheet and overhead key, so that the
templates to be recognized as required. Explain that it is possible to simultaneously use
Activity-Based Costing, overhead sheets, and activity types as methods of overhead
application. The assignment entry must define the controlling area and environment. The
costing sheet and overhead key are optional. Process costs can also be allocated directly
through a work center and work center formula. It is not necessary to allocate it through a
template.
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Templates
Lesson: Allocating Process Costs to a Product
Templates are centrally maintained tabular frameworks.
The Object column can contain business processes, cost centers or activity types, templates,
or object formulas.
The Quantity column is subdivided into plan and actual quantities because the planned and
actual quantities to be allocated have different sources. For example, the planned quantity
can be the lot size and the actual quantity can be the true quantity.
The Activation column is subdivided into plan and actual. For example, the work scheduling
business process should be allocated only if products are semi-finished or finished. In this
case the activation formula is “Material type = HALB or FERT”. This applies to both plan and
actual quantities.
For example, there are two plants, plant 1 and plant 2, each with local work scheduling. You
created two business processes, WS-1 for plant 1 and WS-2 for plant 2. The system needs to
ensure that products in plant1 are allocated automatically to WS-1 and products in plant 2 are
allocated automatically to WS-2. The object formula is "If product from plant=1 then WS-1; if
product from plant=2 then WS-2". The template function can be used for an overall view and
reuse of the rules.
Formulas in the Template
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Figure 56: Formulas in the Template
The use of formulas in templates provides a high degree of flexibility and efficiency in
designing origin-based rules. The formulas let you define allocation quantities and specify
whether allocation should take place or not.
The standard system contains functions that assign environments to templates. The
environment of a template supplies information relevant to cost drivers to the system. An
environment limits the use of functions to those that are applicable only in the context
selected. For example, the standard SAP S/4HANA application contains environments for
production, product cost by period, sales orders, and reference and simulation costing.
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Unit 4: Product Cost Planning Configuration
The standard functions are arranged in function trees and contain short descriptions. The
template is designed in such a way that it can be enhanced by the user. For example, you can
create user-specific functions centrally and make them available in the environments.
Consequently, you can access external and customer-specific structures and additional
master data fields and use them in object, quantity, or activation formulas. The technical
process of creating customer-specific functions is usually handled by IT departments
because it requires programming knowledge.
The templates and formulas are designed to be maintained centrally for automatic use in cost
accounting throughout the company.
Figure 57: Assignment of Templates
To assign the costing sheet and overhead key a template, you have to make the relevant
settings in customizing.
To assign the overhead key to the master data, you can navigate through either of the
following paths:
●
Material master → Overhead group → Overhead key
●
Base planning object → Master record → Overhead key
You can use the overhead key to specify whether the system finds one or more templates.
When you execute a material cost estimate, you can display the way the system interpreted
the templates for the material. If more than one template was used, you can only analyze one
in the cost estimate display mode. For further analysis, you use the information system.
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Assignment of Templates
Lesson: Allocating Process Costs to a Product
How to Allocate Process Costs
1. Use T-FL## / 1010 and PPC1 costing date as today. Show itemization report layout
1SAP01 item categories (grouped). The item category X identifies process costs. It is easy
to assign additional costs to the product using rules.
a) On the FIORI Launchpad, in the Controlling – Valuation group, choose the Display
Material Cost Estimate tile.
b) On the Display Material Cost Estimate with Quantity Structure screen, enter the
following data:
Field Name or Data Type
Value
Material
T-FL##
Plant
1010
Costing Variant
PPC1
Costing Version
1
Valid on
Current date
c) Choose Enter and Continue.
2. Show the template using the explanation tool. Briefly describe the columns in the
template.
a) In customizing, go to Controlling → Product Cost Controlling → Product Cost
Planning → Basic Settings for Materials Costing → Templates → Assign Templates.
The “View for Template Determination”: Overview screen displays the template details.
3. Display the process master record 300900.
a) Choose the Display Business Process app from the Controlling - Master Data group.
b) On the Display Business Process: (Initial Screen) screen, enter 300900 in the Business
Process field.
c) Press ENTER to display the process master record.
4. Display process rate.
a) Choose the Plan Business Process app from the Controlling - Master Data group.
b) Enter Version 0, Periods 1 to 12, the current fiscal year, and the business process
300900.
c) Choose the overview icon and review the process rate.
LESSON SUMMARY
You should now be able to:
●
Describe activity-based costing
●
Explain the purpose of a template
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d) Choose the Itemization button to display the report layout of 1SAP01 item.
Unit 4: Product Cost Planning Configuration
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154
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Unit 4
137
Learning Assessment
1. A costing variant contains all the information required to execute a material cost estimate.
Determine whether this statement is true or false.
X
True
X
False
2. You can create various results for the same material using the same costing variant.
X
True
X
False
3. Which of the following cost estimate options is used in the valuation of actual quantity
structure with tax-based and commercial prices?
Choose the correct answer.
X
A Standard cost estimate
X
B Current cost estimate
X
C Inventory cost estimate
X
D Modified standard cost estimate
4. The valuation variant searches the various price sources listed for each strategy in the
sequence in which they are entered in the strategy.
Determine whether this statement is true or false.
X
True
X
False
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Determine whether this statement is true or false.
Unit 4: Learning Assessment
5. The quantity structure specifies the material costs that can be manually entered in a unit
cost estimate.
Determine whether this statement is true or false.
X
True
X
False
6. What are the forms in which the views for material costing results are available?
Choose the correct answers.
X
A Cost component split
X
B Itemization
X
C Customization
X
D Costed multi-level BOM
7. The purpose of a cost rollup is to ensure that the costs of goods manufactured of all
materials in a multi-level BOM are included in the ______________ of the higher-level
material.
X
A cost estimate
X
B production estimate
X
C original cost of production
8. You can assign various cost component structures for each company code and plant.
Determine whether this statement is true or false.
X
True
X
False
9. Determining prices through planned price iteration is a requirement to create primary cost
component splits.
Determine whether this statement is true or false.
156
X
True
X
False
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Choose the correct answer.
Unit 4: Learning Assessment
10. The function of the primary cost component split is to show the ______________ of a
product when valuating cost centers/activity types and process costs.
Choose the correct answer.
X
A fixed costs
X
B primary costs
X
C variable costs
11. Overhead costing allocates indirect costs to cost estimates by applying a percentage or
quantity-based fixed amount to a specified cost base.
Determine whether this statement is true or false.
X
True
X
False
12. To determine overhead, you use the ___________ that were posted to the order.
X
A total costs
X
B direct costs
X
C indirect costs
13. The purpose of Activity-Based Costing is to accurately account for _______________ based
on a specific cost driver.
Choose the correct answer.
X
A direct costs
X
B indirect costs
X
C fixed costs
14. Material costing with quantity structure can allocate cost parts that are not contained in
the BOM or routing.
Determine whether this statement is true or false.
X
True
X
False
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Choose the correct answer.
Unit 4: Learning Assessment
15. A business process is a process or an activity within a company that uses resources and
activities from one or more cost centers.
Determine whether this statement is true or false.
X
True
X
False
16. The process template can include multiple processes or even multiple process templates
to allocate as many _________________ as appropriate.
Choose the correct answer.
X
A direct costs
X
B indirect costs
X
C fixed costs
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158
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Unit 4
141
Learning Assessment - Answers
1. A costing variant contains all the information required to execute a material cost estimate.
Determine whether this statement is true or false.
X
True
X
False
Correct! The costing variant must contain all information for the cost estimate.
2. You can create various results for the same material using the same costing variant.
X
True
X
False
Correct! Each variant provides a single result.
3. Which of the following cost estimate options is used in the valuation of actual quantity
structure with tax-based and commercial prices?
Choose the correct answer.
X
A Standard cost estimate
X
B Current cost estimate
X
C Inventory cost estimate
X
D Modified standard cost estimate
Correct! The inventory cost estimate is the one relevant for tax and commercial prices.
4. The valuation variant searches the various price sources listed for each strategy in the
sequence in which they are entered in the strategy.
Determine whether this statement is true or false.
X
True
X
False
Correct! The strategy defines the sequence.
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Determine whether this statement is true or false.
Unit 4: Learning Assessment - Answers
5. The quantity structure specifies the material costs that can be manually entered in a unit
cost estimate.
Determine whether this statement is true or false.
X
True
X
False
Correct! The quantity structure doesn’t affect manually entered costs.
6. What are the forms in which the views for material costing results are available?
Choose the correct answers.
X
A Cost component split
X
B Itemization
X
C Customization
X
D Costed multi-level BOM
Correct! Customization is not a valid view.
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Choose the correct answer.
X
A cost estimate
X
B production estimate
X
C original cost of production
Correct! The purpose of a cost rollup is to ensure that the costs of goods manufactured of
all materials in a multi-level BOM are included in the cost estimate of the higher-level
material.
8. You can assign various cost component structures for each company code and plant.
Determine whether this statement is true or false.
X
True
X
False
Correct! You have the option of assigning various structures for the company code-plant
combination.
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7. The purpose of a cost rollup is to ensure that the costs of goods manufactured of all
materials in a multi-level BOM are included in the ______________ of the higher-level
material.
Unit 4: Learning Assessment - Answers
9. Determining prices through planned price iteration is a requirement to create primary cost
component splits.
Determine whether this statement is true or false.
X
True
X
False
Correct! You must determine the planned priced.
10. The function of the primary cost component split is to show the ______________ of a
product when valuating cost centers/activity types and process costs.
Choose the correct answer.
X
A fixed costs
X
B primary costs
X
C variable costs
Correct! The primary costs are the focus of the primary cost component split.
Determine whether this statement is true or false.
X
True
X
False
Correct! You can choose between percentage or quantity-based allocation for the base
amount.
12. To determine overhead, you use the ___________ that were posted to the order.
Choose the correct answer.
X
A total costs
X
B direct costs
X
C indirect costs
Correct! The direct costs are used to calculate overhead.
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11. Overhead costing allocates indirect costs to cost estimates by applying a percentage or
quantity-based fixed amount to a specified cost base.
Unit 4: Learning Assessment - Answers
13. The purpose of Activity-Based Costing is to accurately account for _______________ based
on a specific cost driver.
Choose the correct answer.
X
A direct costs
X
B indirect costs
X
C fixed costs
Correct! ABC helps you track indirect costs.
14. Material costing with quantity structure can allocate cost parts that are not contained in
the BOM or routing.
Determine whether this statement is true or false.
X
True
X
False
Correct! With a quantity structure, you can allocation costs parts not contained in the
BOM and Routings.
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Determine whether this statement is true or false.
X
True
X
False
Correct! ABC helps you track indirect costs from one or more cost centers through the
business process.
16. The process template can include multiple processes or even multiple process templates
to allocate as many _________________ as appropriate.
Choose the correct answer.
X
A direct costs
X
B indirect costs
X
C fixed costs
Correct! Process templates are used for indirect costs.
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15. A business process is a process or an activity within a company that uses resources and
activities from one or more cost centers.
UNIT 5
Material Cost Estimate with
Quantity Structure
Lesson 1
Defining the Quantity Structure
165
Lesson 2
Determining the Quantity Structure
Exercise 9: Display a Cost Estimate
187
193
Lesson 3
Creating Material Cost Estimates with Quantity Structure
Exercise 10: Create a Material Cost Estimate with Quantity Structure
203
209
Updating the Material Master
Exercise 11: Update the Standard Price in the Material Master
216
225
Lesson 5
Changing Prices in the Material Master
235
UNIT OBJECTIVES
●
Display a bill of material
●
Display a routing
●
Display a work center
●
Discuss the integration between routings, cost center master data and work centers
●
Explain production versions
●
Explain how to determine a bill of material (BOM)
●
Explain how to determine a routing
●
Create a material cost estimate with quantity structure
●
List the different price fields in the material master
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Lesson 4
Unit 5: Material Cost Estimate with Quantity Structure
●
Update the standard price in the material master
●
Change prices in the material master
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164
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Unit 5
Lesson 1
147
Defining the Quantity Structure
LESSON OVERVIEW
This lesson explains the logistics master data that will help you use the bill of material (BOM),
routing, and work centers to determine the material and production costs.
Business Example
As the cost planner for your company, you have to check the latest cost estimate for a forklift
that your company is currently producing in a repetitive manufacturing process. You want to
confirm that the costs are accurate because you want to compare the costs of manufacturing
the forklift internally against buying it from a vendor, either as a complete unit or in
assemblies. For this reason, you require the following knowledge:
●
An understanding of how to use a BOM to determine the material costs
●
An understanding of how to use routing and work centers to determine production costs
An understanding of the integration between routing, cost center, master data, and work
center
This lesson focuses on the production master data of BOMs and routings. Bear in mind that
many participants will not have looked at a BOM or routing within the SAP S/4HANA system.
Explain the results of a material cost estimate with quantity structure. Explain how the
component materials are determined using the BOM. Explain the use of routing and work
centers to determine production costs. Demonstrate how to link work centers to cost
centers to valuate production costs. Describe the required entries in the logistics master
data.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Display a bill of material
●
Display a routing
●
Display a work center
●
Discuss the integration between routings, cost center master data and work centers
●
Explain production versions
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Unit 5: Material Cost Estimate with Quantity Structure
Bills of Material (BOMs)
Figure 58: BOM
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The BOM is a directory for a material and its constituent parts, containing information such as
the name, reference number, quantity, and unit of measure.
Uses of BOMs are as follows:
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●
Material requirements planning for procuring parts
●
Production for staging parts
●
Costing for calculating material costs
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Introduce the topic of the BOM. It should be pointed out that in the SAP S/4HANA
application, each assembly level of a multi-level BOM is maintained independently, and the
system automatically constructs the multi-level structure. This is important to understand
for knowing how to access and maintain a BOM.
Lesson: Defining the Quantity Structure
Figure 59: BOM: Example
Explain the costing level and how it controls the sequence for costing the materials within the
BOM. The costing levels were developed to support multi-level unit costing. Also, explain
SAP’s definition of the ROH material type, raw materials are always procured externally and
then processed. A material master record of this type contains purchasing data, but not
sales data since they cannot be sold. Mention that the system automatically assigns
materials to the appropriate costing level within a cost estimate based on their use in a the
product structure. For the items of the cost estimate that are not part of the BOM, the
system automatically assigns the costing level 0. If you use a single product in multiple
BOMs, the system can only assign it to a single costing level.
The system automatically determines costing levels when you create a cost estimate.
Assigning materials to costing levels ensures that the system performs costing in the correct
sequence, raw materials and purchased parts, followed by semi-finished products, followed
by finished products.
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BOM: Example
Unit 5: Material Cost Estimate with Quantity Structure
BOM: Header
Figure 60: BOM: Header
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For a BOM that is relevant for cost estimate planning only, you should select usage indicator
6. The status indicator must be set to released for a BOM to be used in cost estimate
planning. This is different from how you use the status indicator for routing selection. For the
validity, mention that without the use of Engineering Change Management (ECM), changes
to BOM are not date relevant. The system can only see the current BOM, with the overall
validity dates on the header. The system generates alternative BOMs when you create
multiple BOMs for a material that contains the same usage and status indicators. If you
desire the use of a specific alternative for cost planning, then you should identify the
alternative number directly in the costing view of the material master.
The BOM header contains information that applies to all items in the BOM. The BOM must be
valid for costing for the BOM to be read for a cost estimate.
The following fields in the BOM header are relevant to costing:
●
BOM usage
For example, BOMs in use exclusively for engineering or costing purposes.
●
BOM status
You can use the BOM status to control what the BOM can be used for in various other
organizational areas (for example, engineering, costing, MRP).
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Discuss the importance of the BOM usage and status indicators, and their impact on locating
an appropriate BOM for preparing a cost estimate. Explain that the usage indicator is a longterm setting that identifies the applications that may use the BOM. Explain that the status
indicator can represent the current availability of a BOM. For example, when a BOM is still
under construction by engineering, it is not yet available for MRP, costing, or production
control.
Lesson: Defining the Quantity Structure
●
Alternative BOM
Alternative BOMs describe different product structures that create a product with the
same properties. For example, in BOM A, the product uses sheet metal A, while in BOM B,
the same product uses sheet metal B. The resulting product is the same.
●
Lot size range
A BOM can be defined as valid for only a limited range of lot sizes, for example 1 to 1,000
units. You can then create an alternative BOM for lot sizes exceeding 1,000 units.
Figure 61: BOM: Item
Review the fields that are relevant for the item. Explain the item category settings. Highlight
that these are different item categories that are used within the itemization for controlling.
Emphasize that the costing relevancy indicator is only relevant for cost planning, not actual
costing. This is a useful indicator in an either/or situation, that is, you can use either material
x or material y, but not both. The validity indicator is useful for recognizing component
changes based on a specific validity date (using ECM). By default, items marked as bulk
components are not included in cost planning, because it is expected that they will be issued
to an overhead cost center. However, there is a user exit to allow bulk items to be included in
cost planning.
The following fields are relevant for the BOM items:
●
Item category:
This categorization allows you to process data that is relevant to the individual items in a
BOM. The item category is used to control field selection, default values for BOM
maintenance, triggering of specific system activities, and so on. Some examples of item
categories are as follows:
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BOM: Item
Unit 5: Material Cost Estimate with Quantity Structure
-
-
-
●
Category L indicates a stock item. Valuation in accordance with material valuation
strategy or separate cost estimate.
Category N is a non-stock item.
Category R is a variable-size item. Valuation in accordance with material valuation
strategy or separate cost estimate.
Fixed quantity indicator:
Setting this indicator shows that the component quantity is always the same regardless of
lot size. It applies mainly to unavoidable material loss at the start of the production
process.
Fixed quantity is not allowed for the following items:
●
-
Alternative items
-
Co-products
Planned scrap:
Planned scrap is used in material requirements planning (MRP) to determine the
quantities of materials required. When exploding the bill of material (BOM), the system
increases the required quantities of the components by the calculated scrap quantity. For
example, if you set a planned scrap value of 4% and the BOM requires 100 pieces of a
component, the system will calculate that 104 pieces will be required for the assembly.
●
Relevancy to costing indicator:
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For inventory costing, you can link relevancy to costing indicators to factors for the fixed
and variable costs so that the item values can be adjusted by the system depending on the
valuation variant used in costing. You do this in Customizing for Product Cost Controlling.
For example, a BOM item or operation has the indicator for relevancy to costing A which
you have linked in Customizing for Product Cost Controlling to a fixed factor of 0.8 and a
variable factor of 0.7. The BOM item or operation will be costed in inventory costing at
80% of the fixed costs and 70% of the variable costs.
The settings in the BOM usage and BOM item categories enable you to specify whether
this field has a default value and whether you can change this value when you maintain the
BOM.
●
Bulk material:
You usually post bulk material, as consumption at production cost centers, as soon as it is
procured. Because it is usually posted, the cost estimate in the standard system does not
include the bulk material. A user exit is available if you need to cost bulk materials.
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If you do not select this indicator, the system ignores the BOM item in the material cost
estimate. For standard cost estimates, modified standard cost estimates, and current cost
estimates, you only need to decide whether or not the item will be costed.
Lesson: Defining the Quantity Structure
BOM: Non-Stock Materials
Non-stock materials have item category N. They have a material master or they can be listed
only by a description. If the material is identified as a material master, the costing information
can be determined from the accounting view. If the material is only listed by a description, the
user must define the unit of measure and the purchasing data and must include a price, the
pricing unit and the cost element.
Explain some business scenarios that may use this item category:
●
●
●
Due to material storage requirements, it may not be possible to stock some items prior to
the production requirement.
Some items may have an extremely short shelf life, and to deliver prior to immediate need
would risk expiration of the product.
You may specify that certain components are only used for a unique requirement, such as
in an engineer-to-order environment.
Non-stock materials are materials that are not kept in inventory. You always procure them
externally and assign them directly to the order.
Non-stock materials have either no material master or are maintained with a non-stock
material master.
For non-stock materials without a material master, you enter the data that is relevant to
costing directly in the BOM item. For non-stock materials with a material master, you cannot
manually change the prices. The material is valuated in accordance with the strategy
specified in the costing variant. The price shown in the BOM might not be the same as the
price in the cost estimate that you select depending on the valuation strategy.
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Figure 62: BOM: Non-Stock Materials
Unit 5: Material Cost Estimate with Quantity Structure
How to Display a BOM
1. a) On the Fiori launchpad, choose the Display Bill of Material tile.
b) On the Display material BOM: (Initial Screen) screen, enter the following data:
Field Name or Data Type
Value
Material
T-FL00
Plant
1010
BOM Usage
1
c) Choose Enter and Continue.
d) On the Display material BOM: General Item Overview screen, you can see all valid BOM
items on the Material tab page. Double-clicking on a line takes you to the detailed
information for the line. You select the header button to display the settings relevant
for the whole BOM.
Routings
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Figure 63: Routing
Explain that the routing identifies the following three essential elements regarding the
manufacturing process:
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Work center
●
Planned duration you expect for each operation, such as labor, setup, processing
●
Controlling activity you expect to be assigned to the operation
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Lesson: Defining the Quantity Structure
A routing describes a sequence of production steps. It is one of the factors determining
production costs.
A routing consists of one or more operations.
Each operation contains information about the work center, production resources and tools,
material assignments, operation texts, and standard values (how long, how much).
You can use rate routings and recipes for repetitive manufacturing and process
manufacturing.
Figure 64: Routing: Header
The routing header has the following settings that are different to those of the BOM header:
●
Assignment of materials:
A routing can contain multiple materials that utilize the same production process.
●
Usage:
You use task list usage to assign routings to various work areas. This way, you can create
several routings to produce one plant material. These routings are differentiated in your
task list usage.
●
Routing status:
You use this status to indicate the processing stage of a plan. For example, you can
indicate whether a plan is still at the creation stage or whether you have already released it.
You can use some of the fields in the routing similarly to the BOM. Although the usage and
status indicators are configured differently to the BOM usage and status indicators, they
have similar functions. The system assigns a task list group, which is a number (similar to a
document number), to a routing. It is possible to create a routing without reference to a
material. This is useful if you produce many different products the same way, but have minor
variations in the BOM. Rather than create a material specific routing for each item, it is
possible to create a reference routing, and then assign that routing to the materials
concerned using the group.
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Routing: Header
Unit 5: Material Cost Estimate with Quantity Structure
The group counter is similar to the BOM alternative and designates an alternative
manufacturing method for producing an item. This is very common in repetitive
manufacturing, when you can assemble a product on different assembly lines that have
some variation in either standard values or activities and different work centers. It may be
necessary to create a costing-specific routing when a ‘blended’ standard is required. In such
a case, a usage indicator specific for costing can be chosen.
Figure 65: Routing: Operations
For the operations, review the assignment of the work center, which indicates where the
work is being performed and provides the production link to controlling through the cost
center. Explain that you can use the control key to determine the costing indicator, external
processing, and the shop floor interaction that is expected, such as confirmation
requirements. Explain that not all operations are relevant to costing. Some may just be
instructional operations, such as issue material. The material handling costs could be part of
overhead, or they may be a separate cost center/activity type, depending on customer
requirements. The standard values represent the expected duration time for each activity.
Multiplying this time with the cost center/activity type rate provides the cost for the
operation. Mention that planned scrap will affect the cost estimate, but wait until the special
type of processing unit to explain that in detail. Lastly, review the importance of the relevancy
to costing indicator for cost planning.
The control key indicates if an operation is relevant to costing. If the control key assigned
indicates that the operation is relevant to costing, you can use the relevancy to costing
indicator to override the control key.
You can overwrite the standard values of the work center in the routing. By deselecting the
reference indicator in the work center, you can assign activity types/business process.
Linking the standard times with the activity types is done by using the formulas in the work
center.
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Routing: Operations
Lesson: Defining the Quantity Structure
How to Display a Routing
1. Display a routing.
a) On the Fiori Launchpad, choose the tile Change Routing and go to the Display Routing
window through path More → Routing → Display .
b) On the Display Routing: (Initial Screen) screen, enter the following data:
Field Name or Data Type
Value
Material
T-FL00
Plant
1010
Key date
Current date
c) Choose Enter and Continue.
●
Operations and sub-operations, which describe the process steps in the routing.
●
The work center where they are carried out.
●
A short description of the process steps.
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The Display Routing: Operation Overview screen displays the following information:
Master Recipes
Figure 66: Master Recipe
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Unit 5: Material Cost Estimate with Quantity Structure
The Production Planning Process Industries (PP-PI) equivalent of a BOM and routing is a
recipe. It contains both the operations and materials list within one master record. Also,
within PP-PI, you refer to work centers as resources. A recipe can produce many different
products simultaneously. Products produced simultaneously are called co-products and byproducts.
The process industry uses a master recipe instead of a routing.
The production version in the material master defines a fixed and unique link between an
alternative of the recipe group and an alternative of a multiple BOM.
You can include the master recipe in customizing for the quantity structure control in order to
access the recipe in the cost estimate. However, this can be overridden for materials in the
material master or for costing in the costing request screen.
Figure 67: Work Center
Review the different examples of work center - it can represent machines, individual people,
or an assembly team. It indicates a location, object, person or group of people that needs
some type of work planning and management.
You can use work centers in plans such as routings, networks, inspection plans, maintenance
task lists, and rough-cut planning profiles.
You define work centers with reference to a plant. You assign work centers to cost centers.
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Work Centers
Lesson: Defining the Quantity Structure
Use of Work Center and Routing
You can adapt routing or work center to production/assembly, scheduling, capacity planning,
and costing. They are used as basic data by many applications.
Work Center: Fields
Figure 69: Work Center: Fields
Work Center Category:
The work center category determines which data you can maintain in the work center
and which values are proposed.
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Figure 68: Use of Work Center and Routing
Unit 5: Material Cost Estimate with Quantity Structure
Standard value key:
The standard value key determines how many default values you can maintain
(maximum of six), and assigns a meaning (such as setup time, machine time, or labor
time) and a dimension (such as minutes) to the standard values.
Standard values are used in formulas to calculate the execution time, the capacity
requirements and the production costs.
Efficiency Rate:
The performance efficiency rate is the relationship between the predefined target time
and the actual time. You can use the efficiency rate key in costing to correct the default
values.
You can define default values for the routing or master recipe in the work center or resource
respectively. If you assign an operation in the routing or a phase in the master recipe to this
work center or resource then these default values are transferred to the operation or phase.
The following default values are relevant to costing:
●
Control key:
The control key specifies the following:
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Whether the operation or the phase are included in the costing
-
Whether the operation or the phase are processed internally or externally
-
Whether they are confirmed and in what form
Reference indicator:
Setting this indicator prevents the control key from being changed in the routing.
The most important definition within a work center is the standard value key. This controls
how you can plan and measure activities for a work center. You can configure the standard
value key to allow up to six measurable standard values and activities that you can plan for a
work center.
Of critical importance to controlling is the assignment of the work center to a cost center (or
business process). This provides the cost link for the work center. You can assign a work
center to one cost center only at any one time. Based on the standard values that the system
allows for a work center, you can define up to six activity types for the work center. These
activity types will, by default, be copied to the routing you assign the work center to. You can
define a seventh activity type for the work center for the sole purpose of applying additional
costs for production. This can provide a method of applying an indirect cost allocation, using
a formula that you can define in configuration. The benefit of this over the overhead sheet is
that this allocation can be based on the output quantity of the operation. This is not possible
when using the costing sheet, since the costing sheet is based on input quantity and costs.
The seventh activity type does not apply to PP-PI work centers/resources, though it is
normally the only standard value that you use for PS work centers.
How to Display a Work Center
1. Display a work center.
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●
-
Lesson: Defining the Quantity Structure
a) On the Fiori Launchpad, choose the Display work center tile.
b) On the Display Work Center: (Initial Screen) screen, enter 1010 in the Plant field and TM00 in the Work center field.
c) Choose Enter and Continue.
On the Display Work Center: Basic Data screen, the work center data is displayed.
Figure 70: Cost Centers and Activity Types
The activity type classifies the activities that one or several cost centers perform within a
company.
If a cost center provides activities for other cost centers, orders, processes or similar, the
resources of this cost center are being used by other cost centers. The costs of these
resources need to be allocated to the receivers of the activity. Activity types serve as tracing
factors for this cost allocation.
In an internal activity allocation, you enter the quantity of the activity, for example the number
of consulting hours, into the SAP S/4HANA application (manually or automatically). The
system calculates the associated cost based on the activity price and generates a debit to the
receiver and a credit to the sender for both the quantity and the costs. The internal activity
allocation is carried out using secondary cost elements, which you enter in the activity type
master data.
You can restrict the use of the activity type to certain types of cost centers by entering the
allowed cost center categories in the activity type master record. You can enter up to eight
allowed cost center categories, or leave the assignments "unrestricted" by entering an
asterisk (*).
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Cost Centers and Activity Types
Unit 5: Material Cost Estimate with Quantity Structure
The activity type category is used to determine whether and how an activity type is recorded
and allocated. For example, you can allow some activities to be allocated directly, but specify
for others that they are either not allocated or allocated only indirectly.
Relationship Between Cost Center and Activity Type
Figure 71: Activity Output and Price Planning
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For direct activity allocation, you enter the quantity of the activity to be allocated manually. In
order for you to perform a cost allocation and an activity allocation, the SAP S/4HANA
application has to valuate the allocated activity amount using the sender’s price for this
activity type. For a direct activity allocation, you can use the planned price for the cost center/
activity type combination.
You can enter the planned price either manually or let the system calculate it automatically
within planning. To manually set the price, you must set the plan price indicator in the activity
type master record to the value 3 (manual entry, indirect allocation). You can use this
procedure if your price calculation is not complex, for example the depends on the prices of
external suppliers and not on the costs of the cost center.
How to Display a Planned Activity Price
The relationship between the planned price on cost center or activity type should be made
apparent.
1. On the Fiori Launchpad, in the Controlling - Master Data group, choose the Edit Prices for
Activity Types (Cost Centers) tile.
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To enable internal activity allocation, you need to specify which cost centers provide which
activity types at what price. You do this in the SAP S/4HANA application by planning the
activity output and prices for a cost center. To enable this, the SAP S/4HANA application
provides a number of options.
Lesson: Defining the Quantity Structure
Note:
(Planner profile SAPEASY; layout 1-261 price planning, simple layout)
●
Enter version 0 and period 1 to 12, for the current fiscal year
●
Enter cost center 11100 (FI/CO Consulting)
●
Enter activity type 1410 (Senior Consultant)
2. Plan an activity price of 300 EUR.
3. Save your planning.
Figure 72: Routing, Work Center, and Cost Center Integration
To calculate production costs, the routing is used to determine work centers, which are
assigned to one specific cost center. For each operation, the routing must specify where the
work is to be performed (work center), what production activities will be performed, and the
duration of those activities. Using activity type planning, controlling must provide a price to
charge to the cost center when this activity is performed. The activity types that are used for
costing must be planned for the cost center, while the actual duration of the activity is
defined in the routing. The formula determines how the total execution time for the standard
value should be calculated, that is setup (lot size quantity independent) versus machine time
(lot size quantity dependent).
You can create production costs by combining data from production planning with Cost
Center Accounting and Activity-Based Costing.
The routing is assigned to a work center. Therefore, the routing describes the quantity of an
activity and the location of the operations. The work center describes where you perform an
operation.
The work center is linked to a cost center to charge the activity costs.
You can calculate the planned activity prices for the work center through the link to a cost
center and the activity type planning for the cost center.
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Routing, Work Center, and Cost Center Integration
Unit 5: Material Cost Estimate with Quantity Structure
Figure 73: Formulas in Work Centers
You use formulas in the work center to calculate the following data in costing, scheduling, and
capacity planning:
●
Costs
●
Execution times for production orders
●
Internal processing times for networks and maintenance orders
●
Capacity requirements
Specifically for costs, in production orders each of up to six standard values in a work center
can be assigned an activity type and a formula with which the costs of the operations
conducted in the work center are calculated.
In the SAP system you can use predefined SAP formulas and define your own formulas. You
can create formulas in customizing for work centers under define formulas for work centers.
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Formulas in Work Centers
Lesson: Defining the Quantity Structure
Costing Result
The system calculates the costs by multiplying the quantity by the price. The quantity comes
from the standard values for the operation and is modified by the performance efficiency rate
and any relevant formulas.
In the itemization for the cost estimate, the system displays an internal activity for the cost
center or activity type. The system saves the assignment to the operation and work center in
the itemization.
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Figure 74: Costing Result
Unit 5: Material Cost Estimate with Quantity Structure
Facilitator
Producer
Say:
-
-
"We are going to break into groups of
three people to discuss and complete
the following activity".
Do:
-
-
"You will have 15 minutes to work together in the breakout rooms and then we will
meet together in the main classroom".
-
Do:
-
-
-
-
184
-
Assist the instructor by moving between
the various breakout rooms and answering questions regarding the technology
and questions to be discussed.
If desired, archive the individual breakout
room chat and whiteboard pods for immediate discussion in the main classroom and for later reference or distribution.
Broadcast announcements to everyone.
For example, give a two-minute warning
prior to the end of the breakouts.
Describe how to use the audio sub-conferences and refer to this content in the
participant handbook.
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-
Collect the required demographic information, such as job role, prior experience
with the application, and so on, in order
to assign participants to groups.
Assign participants to breakout rooms.
Advise participants about how to contact
the instructor while in the breakout
rooms (that is, private chat and instant
messaging).
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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Lesson: Defining the Quantity Structure
INTERACTIVE ELEMENT: Breakout Rooms
1. How are routings, cost centers, and work centers integrated?
.
.
.
.
.
.
.
.
.
.
Production Versions
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Figure 75: Production Versions
Production versions are mandatory. They define a combination of routing, BOM and lot size.
A production version is mandatory and determines which alternative BOM is used together
with which task list/master recipe to produce a material or create a master production
schedule. For one material, you can have several production versions for various validity
periods and lot-size ranges.
You maintain production versions in the MRP view 4 and costing view 1 in the material master.
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Unit 5: Material Cost Estimate with Quantity Structure
LESSON SUMMARY
You should now be able to:
●
Display a bill of material
●
Display a routing
●
Display a work center
●
Discuss the integration between routings, cost center master data and work centers
●
Explain production versions
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Unit 5
Lesson 2
163
Determining the Quantity Structure
LESSON OVERVIEW
This lesson explains how the quantity structure is determined.
Business Example
●
An understanding of how to determine the bill of material (BOM)
●
An understanding of how to determine routing
●
An understanding of how to determine the quantity structure
●
An understanding of how to display a cost estimate
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As the cost planner for your company, you have to check the latest cost estimate for a forklift
your company is currently producing using a repetitive manufacturing process. The
engineering department wants to compare the costs of manufacturing this material internally
with the cost of buying the forklift from a vendor, either as a complete unit or inparts. For this
reason, you require the following knowledge:
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Explain how to determine a bill of material (BOM)
●
Explain how to determine a routing
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Unit 5: Material Cost Estimate with Quantity Structure
Bill of Material (BOM) Determination
Review the details in the content. They list the search sequence for a BOM and routing. Be
sure to tie it back to the quantity structure determination for a costing variant. Highlight that
during a costing run manual entry is not possible.
The usage indicator leads to the selection of an appropriate BOM, while the status indicator
determines whether the system releases the BOM for costing use. For the BOM selection, the
status indicator is not part of the search strategy. However, for routings, the selection table
combines routing type with the routing status. Some products can have multiple production
methods, such as discreet (task list type N) and, repetitive (task list type R).
Quantity structure control is a process by which the system searches for alternatives if
multiple BOMs or routings exist for a material.
You enter the quantity structure control ID in the costing variant. This ID describes a list of
priorities for the BOM and routing through the BOM application and routing selection keys.
The BOM application determines by means of a selection ID, which BOM usage it selects first.
It lets you define an alternative of a multi-level BOM from a certain date and specifies whether
the BOM status indicator is relevant for the BOM selection.
The standard criteria for BOM determination are as follows:
●
Period of validity: The BOM must be valid on the quantity structure date.
●
Lot-size range: The costing lot size must fall within the lot-size range.
●
Status: The status must allow costing.
To check the BOM that was costed in the cost estimate, use the Info icon to go to the BOM
and double-click the material number to go to the quantity structure.
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Duplication is prohibited.
Duplication is prohibited.
Figure 76: Bill of Material (BOM) Determination
Lesson: Determining the Quantity Structure
Facilitator
Producer
Say:
-
-
"We are going to complete a brainstorming and group collaboration activity
now".
Do:
-
Assist the instructor with compiling the
results and commenting on them.
"I would like you to take two minutes and
write some responses to the question in
your participant handbook".
Wait two minutes.
"Now go ahead and enter your ideas in the
chat pod that I have opened for this activity.
Remember to enter only one idea per line".
Do:
-
-
-
-
Explain that the participants should answer each question with as many responses as possible and that each response will be on a separate line in the
chat area.
Duplication is prohibited.
Duplication is prohibited.
-
Remind participants of the rules of brainstorming.
Each brainstorming session should last
45–60 seconds only.
Launch a whiteboard overlay and then
debrief by typing the most common
ideas on the slide and making use of the
annotation tools.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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189
Unit 5: Material Cost Estimate with Quantity Structure
INTERACTIVE ELEMENT: Chat
1. Take five minutes and write some responses to the following question in your
participant handbook:
How does the system determine a BOM?
.
.
.
.
.
.
.
.
.
.
Routing Determination
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Duplication is prohibited.
Figure 77: Routing Determination
If a production version is defined, the routing contained in it is used. The selection ID for the
routing determines which routing the system selects first. The parameters for selection are
the task list type, task list usage, and plan status.
The standard criteria for routing determination are as follows:
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Lesson: Determining the Quantity Structure
●
Period of validity: The routing must be valid on the quantity structure date.
●
Lot-size range: The costing lot size must fall within the lot-size range.
●
Status: The status must allow costing.
To check the routing that was costed in the cost estimate, use the Info icon to go to the
routing and double-click the routing group to go to the quantity structure.
How to Determine the Quantity Structure
1. On the Fiori Launchpad, Controlling - Valuation Group, choose the Create Material Cost
Estimate tile. Enter the material T-FL00 / Plant 1010.
2. Show MRP view for settings.
Show Settings for Qty Structure Control. Then show entries in customizing.
4. Go to the PC01 key configuration, and locate the key for determining the BOM and the key
for determining the routing (01).The key is again PC01, which can make this demo
confusing as these are different keys calling out different tables, but the standard
configuration uses the same ID for the keys.
5. While you are at this table, explain the rounding indicator.
6. Go to the BOM table titled Check BOM Application. Here, explain that PC01 is linked to
another table for selection, and the selection key is 05.
7. Explain the check boxes on the right of the table. The status indicator on the BOM must
coincide with the release indicators that have been activated for the selection ID.
8. Go to the BOM table titled Check BOM Selection. Follow the entries for ID 05. The
selection priority is 6, then 1, then 3. The first BOM found to be released will be selected.
9. For the routing, go to the table Check Automatic Routing Selection. Follow the entries for
Key 01. Key 01 combines different task list types, which supports the option of having
multiple manufacturing methods available to produce the same product.
Once you have reviewed the master data elements, use the "Display Cost Estimate" exercise
as a demonstration.
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191
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Duplication is prohibited.
3. In customizing, review the quantity structure control for costing variant PPC1. Since this
determination key passes through multiple tables before a selection strategy is found, it is
best to diagram these tables and key relationships on the board. This is similar to the
participants' exercise. Begin with the costing variant PPC1. Here, it can be determined that
the quantity structure control key is PC01.
Unit 5: Material Cost Estimate with Quantity Structure
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Duplication is prohibited.
192
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Unit 5
Exercise 9
167
Display a Cost Estimate
Business Example
As the cost planner for your company, you have to check the latest cost estimate for a forklift
that is currently produced in a repetitive manufacturing process. The engineering department
wants to compare the costs of manufacturing this material internally with the cost of buying
the forklift from a vendor, either as a complete unit or in assemblies.
Task 1: Display the Most Current Cost Estimate
Display the most current cost estimate for material T-FL## in plant 1010 with the status FR
(released without errors) and valid on today’s date. Use the costing variant PPC1 and costing
version 1.
1. The manufacturing engineer wants to know how many units the setup costs are based on.
Therefore, determine the costing lot size.
Task 2: Assess the Cost Situation
Answer some questions relating to the cost situation of your forklift. The manufacturing
engineer wants to know which components have the highest costs and which areas incur
significant costs.
1. What is the total cost of goods manufactured (COGM) for the forklift, and what are the
fixed costs?
2. Which assembly has the highest costs? What is the COGM for this assembly? What is the
material number of this component?
3. Which routing operation has the highest costs and why?
4. Select an appropriate report layout and determine the total material costs (COGM view).
Task 3: Determine a Strategy for Future Cost Estimates
The purchasing department has informed you that the price of material component TFL2A00, which you have purchased for production, will decrease due to supplier overstock.
Your task is to suggest how future cost estimates can take this price change into account. In
order to update the relevant price field in the material master, you need to identify which price
is used based on the valuation strategy in the valuation variant.
1. Find out which BOM was used in the cost estimate for the forklift.
2. Using the explanation facility of costing variant PPC1, find out which valuation variant the
system uses.
3. Determine the strategy defined for material price valuation in this valuation variant.
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193
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Duplication is prohibited.
2. In which posting period did you create the cost estimate? In which fiscal year did you
create the cost estimate?
Unit 5: Material Cost Estimate with Quantity Structure
Task 4: Determine the Production Costs
You can derive the production costs for forklift T-FL## from the routing used for the cost
estimate with quantity structure. The manufacturing engineer wants to know how you
calculated the costs and the areas in the system from which the data was taken. Use a costing
lot size of 100 forklifts and enter the data in the table at the end of this exercise. Change the
cost display back to the costing lot size.
1. Which routing did you use to determine the activities? To find out, check the quantity
structure data.
2. In the itemization, select a report layout that arranges the costs into operations. Which
internal activities did you perform in operation 10?
3. Go back to the routing using the explanation facilities. At which work center was operation
10 performed?
4. The standard values represent the expected duration of the production process. Find the
default values for operation 10 and write them down in the table below. The use of activity
types represents different production processes that can occur from the perspective of
cost accounting. Make a note of the planned activities for operation 10. Select only those
activities for which a standard value was set.
5. What is the base quantity on which you base a standard value?
Duplication is prohibited.
7. The work center is linked to the controlling environment by its assignment to a specific
cost center. The cost center collects the costs occurring at the work center. To which cost
center is the work center from operation 10 assigned?
8. Formula keys are entered for every activity type in the work center. These keys are used to
calculate the activity quantities. What is the formula key for activity type that you find and
what is the formula?
Task 5: Valuate the Activity Quantity
Valuate the activity quantity using the price from the cost center or activity type.
1. Using the valuation variant in customizing, state which strategy is used to select the price
for the activities. Use the explanation facilities in the display.
2. Find the price that the system determined for the cost center/activity type in operation
10. In addition to the total price, find the fixed and variable portions of the price. Include
the price unit and activity type unit. Specify under which allocation cost element, the
activities are displayed by the system.
3. You can now calculate the costs for the internal activity and check the accuracy of the
result using itemization.
194
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6. The basic data for the work center in the routing operation contains a key for performance
efficiency rate that controls the relationship between the target time and the actual time.
This key links the operation directly to the work center at which the operation is
performed. If there is no specific entry here, 100% can be assumed. What is the
performance efficiency rate for this work center?
Unit 5
Solution 9
169
Display a Cost Estimate
Business Example
As the cost planner for your company, you have to check the latest cost estimate for a forklift
that is currently produced in a repetitive manufacturing process. The engineering department
wants to compare the costs of manufacturing this material internally with the cost of buying
the forklift from a vendor, either as a complete unit or in assemblies.
Task 1: Display the Most Current Cost Estimate
Display the most current cost estimate for material T-FL## in plant 1010 with the status FR
(released without errors) and valid on today’s date. Use the costing variant PPC1 and costing
version 1.
1. The manufacturing engineer wants to know how many units the setup costs are based on.
Therefore, determine the costing lot size.
b) On the Display Material Cost Estimate with Quantity Structure screen, enter the
following data:
Field Name
Value
Material
T-FL##
Plant
1010
Costing Variant
PPC1
Costing Version
1
Valid On
Current date
c) Choose the Cost Estimates button.
d) In the Selection of material costs ests dialog box, enter the following data:
Field Name
Value
Material Number
T-FL##
Plant
1010
Costing Variant
PPC1
Costing Version
1
Costing Status
FR
Most current, val. on
Current date
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195
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Duplication is prohibited.
a) In the SAP Fiori launchpad, choose the tile Display Material Cost Estimate in the tile
group Controlling - Valuation.
Unit 5: Material Cost Estimate with Quantity Structure
Field Name
Value
With Qty Struct.
X
e) Choose the Execute button. You see the costing lot size in the header. The costs are
based on a costing lot size of 1.
2. In which posting period did you create the cost estimate? In which fiscal year did you
create the cost estimate?
a) Choose the Dates tab.
The cost estimate was for posting period ____ in fiscal year _______.
Task 2: Assess the Cost Situation
Answer some questions relating to the cost situation of your forklift. The manufacturing
engineer wants to know which components have the highest costs and which areas incur
significant costs.
1. What is the total cost of goods manufactured (COGM) for the forklift, and what are the
fixed costs?
a) On the Display Material Cost Estimate with Quantity Structure screen, choose the
Costs tab.
The COGM for one forklift is EUR __________________. The fixed costs are EUR
_______________.
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a) On the Costs tab, choose the Itemization button.
b) Choose the Choose Layout button.
c) In the Choose Layout dialog box, select the 1SAP04 layout.
d) In the Itemization table, you can see that the assembly T-FL1## has the highest costs.
The COGM of assembly T-FL1## is EUR ________________.
Note:
The COGM view must be selected in the Itemization screen area.
3. Which routing operation has the highest costs and why?
a) Choose the Choose Layout button.
b) In the Choose Layout dialog box, select the 1SAP06 layout.
Operation 10 (Alloc. components) has the highest costs because this operation
incorporates all the materials.
4. Select an appropriate report layout and determine the total material costs (COGM view).
a) Choose the Choose Layout button.
b) In the Choose Layout dialog box, select the 1SAP01 layout.
The total material cost in the COGM view is EUR _________________.
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2. Which assembly has the highest costs? What is the COGM for this assembly? What is the
material number of this component?
Lesson: Determining the Quantity Structure
Task 3: Determine a Strategy for Future Cost Estimates
The purchasing department has informed you that the price of material component TFL2A00, which you have purchased for production, will decrease due to supplier overstock.
Your task is to suggest how future cost estimates can take this price change into account. In
order to update the relevant price field in the material master, you need to identify which price
is used based on the valuation strategy in the valuation variant.
1. Find out which BOM was used in the cost estimate for the forklift.
a) On the Display Material Cost Estimate with Quantity Structure screen, choose the Qty
Struct. tab.
b) In the BOM Data screen area, write down the values (the values vary):
Field Name or Data Type
Value
BOM
Usage
Alternative
2. Using the explanation facility of costing variant PPC1, find out which valuation variant the
system uses.
b) In the Explanation Facilities dialog box, choose the Costing Variant button.
c) On the Display View “Costing Variants”: Details screen, choose the Valuation Variant
button.
d) The variant 001 is used.
3. Determine the strategy defined for material price valuation in this valuation variant.
a) On the Display View “Valuation Variants”: Details screen, the following strategy is
defined in valuation variant 001:
Priority
Strategy Sequence
1
Price from Purchasing Info Record
2
Planned Price 1
3
Standard Price
4
Moving Average Price
Which price field can you change in the material master for T-FL2A## in order to take
the planned price change into account that would not affect the current standard price
of the inventory?
The Planned Price 1 field could be changed in the material master.
Task 4: Determine the Production Costs
You can derive the production costs for forklift T-FL## from the routing used for the cost
estimate with quantity structure. The manufacturing engineer wants to know how you
calculated the costs and the areas in the system from which the data was taken. Use a costing
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197
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Duplication is prohibited.
a) On the Display Material Cost Estimate with Quantity Structure screen, choose the
Information on Cost Estimate button.
Unit 5: Material Cost Estimate with Quantity Structure
lot size of 100 forklifts and enter the data in the table at the end of this exercise. Change the
cost display back to the costing lot size.
1. Which routing did you use to determine the activities? To find out, check the quantity
structure data.
a) On the Display Material Cost Estimate with Quantity Structure screen, choose
More → Settings → Cost Display to select the costing lot size.
b) In the Display Material Cost Estimate with Quantity Structure dialog box, choose the
Continue button.
c) In the Qty Struct. tab, under Routing Data, mark down the routing data (values vary):
Field Name or Data Type
Value
Task List Type
Group
Group Counter
2. In the itemization, select a report layout that arranges the costs into operations. Which
internal activities did you perform in operation 10?
a) Choose the Choose Layout button.
b) In the Choose Layout dialog box, select the 1SAP06 Operations (grouped) layout.
In operation 10, the internal activity of activity type 1421 was performed.
Duplication is prohibited.
a) On the Display Material Cost Estimate with Quantity Structure screen, choose the
Information on Cost Estimate button.
b) In the Explanation Facilities dialog box, choose the Routing button.
Operation 10 was performed at work center T-E##.
4. The standard values represent the expected duration of the production process. Find the
default values for operation 10 and write them down in the table below. The use of activity
types represents different production processes that can occur from the perspective of
cost accounting. Make a note of the planned activities for operation 10. Select only those
activities for which a standard value was set.
a) On the Display Routing: Operation Overview screen, select the operation line item 0010
and choose More → Details → Operation Detail.
b) On the Display Routing: Operation Details screen, you can see that the Std Value for
Act.Type 1421 (labor) is 40 minutes.
5. What is the base quantity on which you base a standard value?
On the Display Routing: Operation Overview screen, you can see that the value of the Base
Quantity field is 1.
6. The basic data for the work center in the routing operation contains a key for performance
efficiency rate that controls the relationship between the target time and the actual time.
This key links the operation directly to the work center at which the operation is
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3. Go back to the routing using the explanation facilities. At which work center was operation
10 performed?
Lesson: Determining the Quantity Structure
performed. If there is no specific entry here, 100% can be assumed. What is the
performance efficiency rate for this work center?
a) On the Display Routing: Operation Overview screen, select the operation line item 0010
and choose More → Details → Operation Detail.
b) On the Display Routing: Operation Details screen, choose the Work center button.
c) On the Display Work Center: Basic Data screen, check the value of the Key for
Performance Efficiency Rate field in the table Standard Values Overview. Since no value
for this field is set, you can assume 100% as the efficiency rate.
7. The work center is linked to the controlling environment by its assignment to a specific
cost center. The cost center collects the costs occurring at the work center. To which cost
center is the work center from operation 10 assigned?
a) On the Display Work Center: Basic Data screen, click the Costing tab.
You can see that cost center 4230 (Assembly Forklifts) is assigned to work center TE##.
8. Formula keys are entered for every activity type in the work center. These keys are used to
calculate the activity quantities. What is the formula key for activity type that you find and
what is the formula?
a) On the Display Work Center: Cost Center Assignment screen, the formula key for
activity type 1421 reads SAP007 Prod: Labor rqmts.
c) The following formula is displayed:
(SAP_03 * SAP_09 / Sap_08) or Labor * Operation quantity / Base
qty
Task 5: Valuate the Activity Quantity
Valuate the activity quantity using the price from the cost center or activity type.
1. Using the valuation variant in customizing, state which strategy is used to select the price
for the activities. Use the explanation facilities in the display.
a) On the Display Work Center: Cost Center Assignment screen, choose Back.
b) On the Display Material Cost Estimate with Quantity Structure screen, choose the
Information on Cost Estimate button.
c) In the Explanation Facilities dialog box, choose the Costing Variant button.
d) On the Display View “Costing Variants”: Details screen, choose the Valuation Variant
button.
e) On the Display View “Valuation Variants”: Details screen, choose the Activity Types/
Processes tab.
f) You will see the following data:
Priority
Strategy Sequence
1
Plan Price as Average of All Fiscal Year Periods
2. Find the price that the system determined for the cost center/activity type in operation
10. In addition to the total price, find the fixed and variable portions of the price. Include
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199
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b) Select SAP007 and choose the Display formula button.
Unit 5: Material Cost Estimate with Quantity Structure
the price unit and activity type unit. Specify under which allocation cost element, the
activities are displayed by the system.
a) Exit the explanation facilities and create a new session.
b) In the SAP Fiori launchpad, choose the tile Edit Prices for Activity Types in the tile
group Controlling - Master Data.
c) On the Change Activity Type/Price Planning: Initial Screen screen, enter the following
data:
Field Name or Data Type
Value
Version
0
From period
1
To period
12
Fiscal year
Valuation date year of T—FL##
cost estimate
Cost Center
4230
Activity Type
1421
d) Choose the Overview button.
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Field Name or Data Type
Value
Total price
Variable price
Fixed price
Price Unit
Activity unit
H
Allocation cost element
3. You can now calculate the costs for the internal activity and check the accuracy of the
result using itemization.
a) Check the accuracy of the result with the following information:
Lot size
100 pc
Routing
200
Operation
10
Activity
1421
Work center
1310
Standard value
40 mins
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e) On the Display Activity Type/Price Planning: Overview Screen screen, write down the
values:
Lesson: Determining the Quantity Structure
Base quantity
1 pc
Work center
T-E##
Performance efficiency rate
100%
Cost center
4230
Formula key
SAP007
Formula
Labor * operation quantity / base quantity
Cost center
4230
Activity type
1421
Valuation variant
001
Strategy sequence for activity types/
processes (first priority)
Plan price as average over all fiscal year
periods
Total price per unit
___
Fixed price per unit
___
Allocation cost element
Cost of internal activity formula / performance eff. rate * Price / Unit
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(((40 min * 100 pc /1pc)/60)/100%) *
(Total price per Unit – from above) ___ or
(0.6667 Hours)/ Performance Effi Rate *
Total Price/H
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Duplication is prohibited.
Variable price per unit
Unit 5: Material Cost Estimate with Quantity Structure
LESSON SUMMARY
You should now be able to:
●
Explain how to determine a bill of material (BOM)
●
Explain how to determine a routing
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202
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Unit 5
Lesson 3
177
Creating Material Cost Estimates with
Quantity Structure
LESSON OVERVIEW
This lesson explains how to create a material cost estimate with quantity structure. The
lesson also explains how to analyze the results of a material cost estimate with quantity
structure.
Business Example
●
An understanding of material cost estimates with quantity structure
●
An understanding of the results of the material cost estimate with quantity structure
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Create a material cost estimate with quantity structure
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203
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Duplication is prohibited.
The prototype of a new product has been successful and production is to commence shortly.
Your task is to cost the new forklift. You can create an automatic cost estimate because work
scheduling has already defined bills of materials (BOMs) and routings. After executing the
cost estimate, the engineering department informs you that you should add an additional
material and other costs to the BOM and routing for the product. The engineering department
has not yet entered these changes in the quantity structure data. You decide to include the
additional costs using multilevel unit costing in the current cost estimate. For this reason, you
require the following knowledge:
Unit 5: Material Cost Estimate with Quantity Structure
Material Cost Estimates with Quantity Structure
Figure 78: Material Cost Estimate with Quantity Structure
The dates are proposed from the costing variant and determine the following parameters:
●
The validity period of the cost estimate (costing date from/to)
●
The determination of the quantity structure (quantity structure date)
●
The valuation date for materials and activities (valuation date)
The system determines and values the quantity structure automatically. The cost estimate is
not updated in the database until it is saved.
204
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Duplication is prohibited.
The prerequisite for creating a cost estimate with a quantity structure is a material master
with costing view and accounting view. When you create a cost estimate with a quantity
structure, you enter the costing variant, material, and plant.
Lesson: Creating Material Cost Estimates with Quantity Structure
Material Cost Estimate Screen
The costing result, itemization, cost component report, and costed BOM are visible from a
single screen. You can customize and save the layout of the screen for individual users. You
can execute detailed reports directly from the cost estimate screen.
Overall log contains the complete list of messages for all the materials costed. It contains
display variants (which you can customize) that enable you to perform summarized analysis
of the errors. Double-clicking on the material in the header of a cost estimate or in the status
display displays the messages specific to the particular material.
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205
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Duplication is prohibited.
Figure 79: Material Cost Estimate Screen
Unit 5: Material Cost Estimate with Quantity Structure
Analysis of Material Cost Estimate with Quantity Structure
Figure 80: Analysis of Material Cost Estimate with Quantity Structure
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When analyzing the cost estimate, bear in mind that you can use the following functions:
206
●
Define your own display variants and initial variant.
●
Use the navigational options to access reports.
●
Navigate through the multi-level BOM (costing structure) to the reports and error logs.
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You can analyze the costing results with standard reports and display variants. You can use
different cost component views (such as the cost of goods manufactured or the cost of goods
sold) for the costing results.
Lesson: Creating Material Cost Estimates with Quantity Structure
Explanation Facilities
Figure 81: Explanation Facilities
The explanation facilities available depend on the object to be costed.
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Duplication is prohibited.
The explanation facilities enable the cost planner to directly access data in the costing
environment from the cost estimate screen.
Use the "Create a Material Cost Estimate with Quantity Structure" exercise as a
demonstration.
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207
Unit 5: Material Cost Estimate with Quantity Structure
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Duplication is prohibited.
208
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Unit 5
Exercise 10
183
Create a Material Cost Estimate with Quantity
Structure
Business Example
Your task is to cost a new forklift. You can create an automatic cost estimate, because work
scheduling has already defined BOMs and routings. After you have executed the cost
estimate, the engineering department informs you that you should add an additional material
and other costs to the BOM and routing for your product. These changes have not yet been
entered in the quantity structure data.
Task 1: Create a Cost Estimate with Quantity Structure
Create a cost estimate with quantity structure for material T-FL##. Use costing variant PPC1,
plant 1010, costing lot size 10 pieces, and costing version 1. Do not enter any BOM or routing
data. The cost estimate should be valid at the start of the following fiscal period. For the
Costing to date, enter the maximum date. Accept the default quantity structure date and
valuation date.
2. What is the forklift’s total cost of goods manufactured?
3. Examine the message list and check which message types appear in the log.
4. Which components were costed? Access the costing result for the gearbox of your forklift
T-FL2##. What is the total cost of goods manufactured for the gearbox?
Task 2: Identify How the System Determined BOM and Routing
You deliberately did not enter any quantity structure data in the initial screen of the cost
estimate. Explain how the system determined the BOM and routing.
1. Using the tab for the quantity structure, identify the BOM and routing read by the system
for the automatic cost estimate.
2. Where does the system obtain the information for the BOM and routing data from?
3. Which BOM application and which routing selection ID were read by the system?
4. Which routing does the system select as its first priority?
5. Save the cost estimate with cost component split, itemization, and log.
Task 3: View a Detail Report that Itemizes Cost Estimates
Go to the Information System for material costing and select a detail report that itemizes your
cost estimate for material T-FL##. Choose the COGM view.
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209
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1. What is the costing status of your cost estimate?
Unit 5: Material Cost Estimate with Quantity Structure
1. What are the total material costs of your cost estimate? Use layout 1SAP01.
2. What is the total cost of the internal activity? Use layout 1SAP06.
3. You now want to focus on the costs that are equal or above EUR 100. Set the appropriate
filter.
4. Delete the filter.
On the Item Categories (Grouped) screen, choose More → Edit → Delete Filter.
5. What are the total costs of all assemblies? To answer this question, select a suitable
report layout.
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Duplication is prohibited.
210
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Unit 5
Solution 10
185
Create a Material Cost Estimate with Quantity
Structure
Business Example
Your task is to cost a new forklift. You can create an automatic cost estimate, because work
scheduling has already defined BOMs and routings. After you have executed the cost
estimate, the engineering department informs you that you should add an additional material
and other costs to the BOM and routing for your product. These changes have not yet been
entered in the quantity structure data.
Task 1: Create a Cost Estimate with Quantity Structure
Create a cost estimate with quantity structure for material T-FL##. Use costing variant PPC1,
plant 1010, costing lot size 10 pieces, and costing version 1. Do not enter any BOM or routing
data. The cost estimate should be valid at the start of the following fiscal period. For the
Costing to date, enter the maximum date. Accept the default quantity structure date and
valuation date.
a) In the SAP Fiori launchpad, choose the tile Create Material Cost Estimates in the tile
group Controlling - Valuation.
b) On the Create Material Cost Estimate with Quantity Structure screen, enter the
following data:
Field Name or Data Type
Value
Material
T-FL##
Plant
1010
Costing Variant
PPC1
Costing Version
1
Costing Lot Size
10
c) Choose the Dates tab.
d) Choose the Default Values button.
e) Choose Enter to accept the default values. The system executes the cost estimate
automatically.
f) In the new screen choose the Costing Data tab.
The Costing Status field shows Costed Without Errors.
2. What is the forklift’s total cost of goods manufactured?
a) Choose the Costs tab.
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211
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Duplication is prohibited.
1. What is the costing status of your cost estimate?
Unit 5: Material Cost Estimate with Quantity Structure
b) The total COGM of the forklift is EUR ____________________.
3. Examine the message list and check which message types appear in the log.
a) To display the message list, choose More → Extras → Log or choose the Log with All
Messages button.
b) The list displayed contains warning and information messages.
4. Which components were costed? Access the costing result for the gearbox of your forklift
T-FL2##. What is the total cost of goods manufactured for the gearbox?
a) On the left part of the window, the costing structure shows the following components
that were costed:
●
Material T-FL1##
●
Material T-FL2##
●
Material T-FL3##
●
Material T-FL4##
●
Material T-FL5##
●
Material T-FL6##
The material numbers of the assemblies are also in the itemization.
Duplication is prohibited.
c) In the costing structure, double-click Forklift.
Task 2: Identify How the System Determined BOM and Routing
You deliberately did not enter any quantity structure data in the initial screen of the cost
estimate. Explain how the system determined the BOM and routing.
1. Using the tab for the quantity structure, identify the BOM and routing read by the system
for the automatic cost estimate.
a) On the Create Material Cost Estimate with Quantity Structure screen, choose the Qty
Struct. tab.
b) Under BOM Data, the following data is displayed:
Field Name
Value
BOM
0000####
Usage
1
Alternative
1
c) Under Routing, the following data is displayed:
212
Field Name
Value
Task List Type
N
Group
50000###
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Duplication is prohibited.
b) Double-click Gearbox. Analyze the costing result for this material in the right screen
area. The total COGM of the gearbox is EUR _________________________.
Lesson: Creating Material Cost Estimates with Quantity Structure
Field Name
Value
Group Counter
1
2. Where does the system obtain the information for the BOM and routing data from?
The system obtains the information from the quantity structure control that is assigned to
costing variant PPC1.
3. Which BOM application and which routing selection ID were read by the system?
a) Choose the Information on Cost Estimate button.
b) In the Explanation Facilities dialog box, choose the Costing Variant button.
c) On the Display View “Costing Variants”: Details screen, choose the Qty Struct. Control
button.
d) On the Display View “Quantity Structure Determination (Cross-Plant)”: Details screen,
choose the BOM Application push button.
PC01 Costing was entered in the quantity structure control.
e) Go back to the quantity structure control and click the Routing tab.
4. Which routing does the system select as its first priority?
a) In the Explanation Facilities dialog box, choose the Routing push button.
The system's first priority is to search for a routing of usage 1 with status 4 (released –
general) for production.
5. Save the cost estimate with cost component split, itemization, and log.
a) On the Create Material Cost Estimate with Quantity Structure screen, choose Save.
b) Choose the SAP Logo (Navigate to Home Page).
Task 3: View a Detail Report that Itemizes Cost Estimates
Go to the Information System for material costing and select a detail report that itemizes your
cost estimate for material T-FL##. Choose the COGM view.
1. What are the total material costs of your cost estimate? Use layout 1SAP01.
a) In the SAP Fiori launchpad, select the tile Itemization Materials in the tile group
Controlling - Valuation.
b) On the Analyze Itemization: Item Categories (Grouped) screen, enter the following
data:
Field Name
Value
Material
T-FL##
Plant
1010
Costing variant
PPC1
Costing version
1
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Duplication is prohibited.
The routing selection ID Y1 was read by the system.
Unit 5: Material Cost Estimate with Quantity Structure
Field Name
Value
Costing Date
First day of the following month
Cost base
10
Cost Comp. view
Cost of goods manufactured
c) Choose the Execute button.
d) On the Item Categories (Grouped) screen, the report is sorted according to the item.
The total material costs (material components and assemblies) are EUR _______.
2. What is the total cost of the internal activity? Use layout 1SAP06.
The total cost of the internal activities is EUR _______.
3. You now want to focus on the costs that are equal or above EUR 100. Set the appropriate
filter.
a) Select the Total Value column.
b) Choose the Set Filter button.
c) Double-click Total Value field from category KeyFigures in Column Set. Select Total
Value in Filter criteria and choose Define Values.
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e) In the Maintain Selection Options dialog box, select Greater than or Equal to and
choose the Continue button.
f) In the Determine values for filter criteria dialog box, enter 100 in the Total Value field.
g) Choose the Continue button.
4. Delete the filter.
On the Item Categories (Grouped) screen, choose More → Edit → Delete Filter.
5. What are the total costs of all assemblies? To answer this question, select a suitable
report layout.
a) Choose the Choose Layout button.
b) In the Choose layout dialog box, choose 1SAP04.
The total costs of all assemblies are EUR ______.
c) Choose the SAP Logo (Navigate to Home Page).
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d) In the Determine values for filter criteria dialog box, click the Total Value field and
choose the Selection Options button.
Lesson: Creating Material Cost Estimates with Quantity Structure
LESSON SUMMARY
You should now be able to:
●
Create a material cost estimate with quantity structure
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Duplication is prohibited.
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215
Unit 5
Lesson 4
190
Updating the Material Master
LESSON OVERVIEW
The lesson explains how to update prices in the material master. It also explains how to use
the functions of material costing with quantity structure efficiently.
Business Example
●
An understanding of prices in material master
●
An understanding of the procedure to update standard price
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Duplication is prohibited.
The prototype of a new product has been successful and production is to commence shortly.
Your need to calculate and set an accurate initial standard price. You must make all the
settings required for valuation and use the correct quantity structure. For this reason, you
require the following knowledge:
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
List the different price fields in the material master
●
Update the standard price in the material master
Prices in Material Master
Figure 82: Material Master Prices
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Lesson: Updating the Material Master
Material Master Prices: Explanation
The material master prices are as follows:
●
Planned prices 1, 2, and 3:
Planned prices 1, 2, and 3 are used for raw materials and purchased parts, and to valuate
the materials in the cost estimate.
●
Tax-based and commercial prices:
Tax-based and commercial prices are entered for purchased parts in inventory costing to
determine values such as lowest value. An inventory cost estimate can use these prices for
valuation, and then update the costing results for finished and semi-finished products in
the material master.
●
Price control:
Price control is an indicator that controls which price is used to valuate the inventory of a
material. The available options are standard price and moving average price.
These prices are used to valuate goods movements within the SAP S/4HANA application
and to valuate inventories.
A standard cost estimate is used to update the standard price. You can branch from the
accounting and costing views to the results of standard cost estimates. These results update
the standard price.
Update of Prices in the Material Master
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Duplication is prohibited.
Figure 83: Update of Prices in the Material Master
You can analyze the different cost estimates and write the results to price fields in the
material master depending on the purpose of costing.
The costing type determines which, if any, price field in the material master you can update
with the results of the cost estimate.
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217
Unit 5: Material Cost Estimate with Quantity Structure
You can update price fields in the material master with the following results:
●
●
●
The result of the standard cost estimate as the standard price.
The result of the modified standard cost estimate or the current cost estimate as planned
prices 1, 2, and 3.
The result of the inventory cost estimate as commercial prices 1, 2, and 3 or tax-based
prices.
In the valuation strategy, you can refer to different prices in the material master so that you
can use these prices in other cost estimates.
The standard price is updated in the material master by first marking and then releasing a
standard cost estimate.
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Duplication is prohibited.
Integration: Standard Price and Standard Cost Estimate
Figure 84: Integration: Standard Price and Standard Cost Estimate
Explain that when you create a cost estimate, it has status KA or KF. When you execute a
marking transaction for a cost estimate, the system updates the material master future
standard price field and changes the cost estimate’s status from KA to VO. The release
program checks the status to determine whether the cost estimate is available for releasing.
Once the program releases the cost estimate, the status is changed to FR.
Reiterate that it is possible to repeatedly mark a future standard for a material, the system
will issue a warning stating that a marked standard exists. However, once the release
program releases the cost estimate, the system will not allow you to create another cost
estimate for the same period/costing variant/version. If the release program releases a cost
estimate in error, it will be necessary to delete this entry from the database. Also mention
that there is a standard program that reviews the variance and revaluation impact of a
costing run compared to either another costing run, or a price field from the material master.
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Lesson: Updating the Material Master
This program should be executed, to look for potential errors before releasing a cost
estimate.
Price control plays a crucial role in material valuation. When the price control indicator is set
to S, the system valuates the material inventory at standard price. In addition, goods
movements are valuated directly in the SAP S/4HANA application using a price selected in
accordance with the price control indicator.
In Cost Object Controlling, standard price updated by a standard cost estimate is used for
costing. The system can use the itemization of standard cost estimates to determine the
target costs for manufacturing orders. You can analyze the difference between target cost
and actual cost at the level of variance categories, such as quantity or price variances. The
saved itemization provides the basis for the variance calculation.
In profitability analysis, you can use standard cost estimates (or other material cost
estimates) to compare the revenues of the billed quantity with the cost component split of the
product.
A standard price is also required in the material ledger to determine the actual price.
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Duplication is prohibited.
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219
Unit 5: Material Cost Estimate with Quantity Structure
Facilitator
Producer
Say:
-
"You are going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I will give you five minutes to work with
your partner and then we will summarize
briefly as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
220
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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Lesson: Updating the Material Master
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question: What price fields are available in the
material master?
Using private chat, take five minutes and discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
How to Display the Different Price Fields in the Material Master
1. Display the different price fields for material T–FL00.
a) On the Fiori Launchpad choose the Display Material app in the Controlling - Logistics
Master Data Group.
b) On the Display Material: (Initial Screen) screen, enter T–FL00 in the Material field.
c) Choose Enter and Continue.
d) In the Select View(s) dialog box, select Accounting 1, Accounting 2, and Costing 2..
e) Choose the Continue button.
f) In the Organization Levels dialog box, enter 1010 in the Plant field.
g) Choose the Continue button.
h) On the Display Material T–FL00 (Finished product) screen, you can see the price fields
on the Accounting 1 tab.
i) Choose the Accounting 2 tab to see the tax and commercial prices fields.
j) Review the planned price fields on Costing 2 tab.
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221
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Duplication is prohibited.
.
Unit 5: Material Cost Estimate with Quantity Structure
Procedure: Update of Standard Price
Figure 85: Procedure: Update of Standard Price
Duplication is prohibited.
1. Execution of material cost estimate:
Use a costing variant that is applicable to a standard cost estimate (costing type).
For example, in December 2012, you create a new standard cost estimate for January
2013, that is, a validity date of 01.01.2013 valid until 12.31.9999.
2. Accuracy of costing results:
The system cannot detect content errors, such as incorrect prices or quantities. Check
the error status and verify separately that the quantity structure and content order are
correct.
3. Allow update:
You can specify per company code, plant and material range whether marking is allowed
for the fiscal year and period.
4. Marking:
After you have carried out the steps 1 to 3, you can mark the material cost estimate. The
future planned price is updated in the material master and linked to the standard cost
estimate.
5. Release standard cost estimate:
You can only release cost estimates once. The release date cannot be earlier than the valid
from date of the cost estimate.
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Duplication is prohibited.
The procedure for updating standard price is as follows:
Lesson: Updating the Material Master
Example: Update of Standard Price
You want to update the standard price in a previously released standard cost estimate from
10 to 15.. The material master is subject to S price control and inventory is valuated with 10 *
10 = 100.
The different phases of the update of standard price are as follows:
●
Marking
The future planned price of 15 is set in the material master and a link to the new standard
cost estimate established. No revaluation takes place.
●
Release
Release converts the future standard price of 15 to the current standard price. The
previous current standard price of 10 is now shown as the previous price and the future
planned price is empty.
●
Revaluation
If you update the price of a material that has inventory, the inventory is revalued with the
new price. In this example, the inventory value is increased by 50 and a profit posting
“Profit from revaluation” of 50 is posted. The valuation class and its account determination
in the material master control how the system finds the balance sheet accounts and profit
and loss accounts.
Use the "Update the Standard Price in the Material Master" exercise as a demonstration.
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223
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Duplication is prohibited.
Figure 86: Example: Update of Standard Price
Unit 5: Material Cost Estimate with Quantity Structure
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Duplication is prohibited.
224
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Unit 5
Exercise 11
197
Update the Standard Price in the Material
Master
Business Example
You create a material cost estimate for T-FL1## and analyze the saved result. This costing
result is used to trigger a revaluation of your inventories. The costing result of an assembly of
the semi-finished product should be used to update the standard price field in the material
master. You can observe the result of the price update process in the material master.
Task 1: Update the Material Master with the Material Cost Estimate Results
Update the standard cost fields in the material master with the results of the material cost
estimate.
1. Display the material master records of your product T-FL## and semi-finished material TFL1## in plant 1010. Select the accounting and costing views.
2. Enter the prices in the table below.
Value T-FL##
Value T–FL1##
Duplication is prohibited.
Duplication is prohibited.
Field
Tax price 1
Future standard cost estimate price
Current standard cost estimate price
Previous standard cost estimate price
3. To which periods do the cost estimates refer?
Task 2: Create a Standard Cost Estimate
Create a standard cost estimate for product T-FL1##.
1. Use plant 1010, costing variant PPC1, and costing version 1. Enter a costing lot size of 100
pieces. Choose today’s date for the costing from date. The cost estimate should be valid
until the end of the current year. Accept the default quantity structure date and valuation
date.
2. What is the error status of your cost estimate?
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225
Unit 5: Material Cost Estimate with Quantity Structure
3. Go to the material overview. Which products were costed in this transaction?
4. Go to customizing using the explanation facilities, and verify that you can update the
standard price for assembly T-FL1## with the result of the cost estimate.
5. Save the cost estimate.
Task 3: Verify Marking is Allowed for the Current Posting Period
Go to the menu option for the price update to verify that marking for company code 1010 is
allowed for the current posting period.
1. For which costing variant and version does the system allow marking and release in the
current period?
Task 4: Mark the Cost Estimate of an Assembly and Plant
Mark the cost estimate of assembly T-FL1## and plant 1010 for the current period in the
current fiscal year.
1. Deselect the indicator for the test run in the processing options. Do not exit the result list.
Task 5: Display the Material Master Record of a Component
Display the material master record of your component T-FL1##.
Duplication is prohibited.
Enter the prices and periods in the table below.
Field
Price for T-FL1##
Period
Future standard cost estimate price
Current standard cost estimate price
Previous standard cost estimate price
2. What is the current stock balance of T-FL1##? Go to the Accounting 1 view to determine
this.
Task 6: Release a Cost Estimate
Release cost estimate T-FL1## for plant 1010.
1. Go to the log in the result list and navigate from the price change document to the display
of the accounting documents. Do not exit the result list.
Task 7: Display the Material Master Record
Display the material master record of T-FL1##.
1. From the result list, display the material master record of T-FL1## in plant 1010. Go to the
Costing 2 view.
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Duplication is prohibited.
1. From the result list, display the material master record of component T-FL1## in plant
1010 by selecting the material from the result list. Select the Costing 2 view.
Lesson: Updating the Material Master
2. What are the prices?
3. What is the period?
Field
Price for T-FL1##
Period
Result from cost estimate
Current period
Future standard cost estimate price
Current standard cost estimate price
Task 8: Check if the Price Field has Changed
Check if the price field that you entered earlier in the material master of the finished product
T-FL## has changed.
1. Go to the material master of the finished product T-FL## and select the Costing 2 view.
2. Has the price field that you entered earlier changed, why?
Marking and release was done only for assembly T-FL1##. This does not affect the
remaining assemblies and the final result. If the costing result for material T-FL## should
be written to the standard price field, then you must carry out the marking and release
specifically for this material.
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227
Duplication is prohibited.
Duplication is prohibited.
Previous standard cost estimate price
Unit 5
Solution 11
200
Update the Standard Price in the Material
Master
Business Example
You create a material cost estimate for T-FL1## and analyze the saved result. This costing
result is used to trigger a revaluation of your inventories. The costing result of an assembly of
the semi-finished product should be used to update the standard price field in the material
master. You can observe the result of the price update process in the material master.
Task 1: Update the Material Master with the Material Cost Estimate Results
Update the standard cost fields in the material master with the results of the material cost
estimate.
1. Display the material master records of your product T-FL## and semi-finished material TFL1## in plant 1010. Select the accounting and costing views.
Duplication is prohibited.
b) On the Display Material (Initial Screen), enter T-FL## in the Material field.
c) Choose the Select View(s) button.
d) In the Select View(s) dialog box, select Accounting 1, Accounting 2, Costing 1, and
Costing 2.
e) Choose the Continue button.
f) In the Organization Levels dialog box, enter 1010 in the Plant field.
g) Choose the Continue button.
h) Repeat steps b. to g. for material T-FL1## in a new window.
2. Enter the prices in the table below.
a) You can find the tax price in the Accounting 2 view. You can find the remaining prices in
the Costing 2 view.
Field
Value T-FL##
Value T–FL1##
Tax price 1
Future standard cost estimate price
Current standard cost estimate price
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Duplication is prohibited.
a) In the SAP Fiori launchpad, choose the tile Display Material in the tile group Controlling
- Logistics Master Data .
Lesson: Updating the Material Master
Field
Value T-FL##
Value T–FL1##
Previous standard cost estimate price
3. To which periods do the cost estimates refer?
You can find the period for the cost estimates directly above the price field in the Costing 2
view in the material master.
Task 2: Create a Standard Cost Estimate
Create a standard cost estimate for product T-FL1##.
1. Use plant 1010, costing variant PPC1, and costing version 1. Enter a costing lot size of 100
pieces. Choose today’s date for the costing from date. The cost estimate should be valid
until the end of the current year. Accept the default quantity structure date and valuation
date.
a) In the SAP Fiori launchpad, choose the tile Create Material Cost Estimate in the tile
group Controlling - Valuation.
Field Name or Data Type
Value
Material
T-FL1##
Plant
1010
Costing Variant
PPC1
Costing Version
1
Costing Lot Size
10
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Duplication is prohibited.
b) On the Create Material Cost Estimate with Quantity Structure screen, enter the
following data:
c) On the Dates tab, choose the Default Values button.
d) Change the following dates:
Field Name or Data Type
Value
Costing Date From
Current date
Costing Date To
Last day of the current year
Qty Structure Date
First day of the following month
Valuation Date
First day of the following month
e) Choose Enter. The system executes the cost estimate automatically.
2. What is the error status of your cost estimate?
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229
Unit 5: Material Cost Estimate with Quantity Structure
Go to the Costing Data tab. The status of the cost estimate should be Costed Without
Errors.
3. Go to the material overview. Which products were costed in this transaction?
a) Choose More → Goto → Material Overview.
b) All materials should have the status KA (costed without errors).
4. Go to customizing using the explanation facilities, and verify that you can update the
standard price for assembly T-FL1## with the result of the cost estimate.
a) Double-click PPC1 in the Costing Variant field.
b) On the Display View “Costing Variants”: Details screen, choose the Costing Type
button.
You see that costing type 01 Standard cost est. (mat.) allows the standard price to be
updated in the material master.
5. Save the cost estimate.
a) Go back to the Create Material Cost Estimate with Quantity Structure screen.
b) Choose Save.
1. For which costing variant and version does the system allow marking and release in the
current period?
a) In the SAP Fiori launchpad, choose the tile Release Material Cost Estimate in the tile
group Controlling - Valuation.
b) On the Price Update: Mark Standard Price screen, enter the following data:
Field Name or Data Type
Value
Posting Period
Current month
Fiscal Year
Current fiscal year
c) Choose the Marking Allowance button and check if marking is already allowed. If not,
allow it by following the steps below (d.-f.).
d) On the Price Update: Organizational Measure dialog box, choose the company code
1010.
e) In the Permitted std cost est variant dialog box, enter the following data:
Field Name or Data Type
Value
Costing Variant
PPC1
Costing Version
1
f) Choose Issue allowance for marking .
g) Choose Exit.
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Duplication is prohibited.
Duplication is prohibited.
Task 3: Verify Marking is Allowed for the Current Posting Period
Go to the menu option for the price update to verify that marking for company code 1010 is
allowed for the current posting period.
Lesson: Updating the Material Master
Task 4: Mark the Cost Estimate of an Assembly and Plant
Mark the cost estimate of assembly T-FL1## and plant 1010 for the current period in the
current fiscal year.
1. Deselect the indicator for the test run in the processing options. Do not exit the result list.
a) In the SAP Fiori launchpad, choose the tile Release Material Cost Estimate in the tile
group Controlling - Valuation.
b) On the Price Update: Mark Standard Price screen, enter the following data:
Field Name or Data Type
Value
Posting Period
Current month
Fiscal year
Current fiscal year
Company Code
1010
Plant
1010
Material
T-FL1##
c) Deselect Test run.
d) Choose the Execute button.
Note:
Verify that the cost estimate has the status VO marked without errors
before executing the price update.
Do not exit the result list.
Task 5: Display the Material Master Record of a Component
Display the material master record of your component T-FL1##.
1. From the result list, display the material master record of component T-FL1## in plant
1010 by selecting the material from the result list. Select the Costing 2 view.
Enter the prices and periods in the table below.
Field
Price for T-FL1##
Period
Future standard cost estimate price
Current standard cost estimate price
Previous standard cost estimate price
a) On the Price Update: Mark Standard Price screen, select the material T-FL1## and
choose Material Master.
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231
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Duplication is prohibited.
e) Choose Back.
Unit 5: Material Cost Estimate with Quantity Structure
b) On the Display Material T-FL1## (Semi-finished product) screen, choose the Costing 2
tab. The period is the current period of the current fiscal year. Enter the prices and
periods in the table above.
The entries for the current and previous period are unchanged.
2. What is the current stock balance of T-FL1##? Go to the Accounting 1 view to determine
this.
a) Click the Accounting 1 tab.
Review the stock quantity and stock value.
Task 6: Release a Cost Estimate
Release cost estimate T-FL1## for plant 1010.
1. Go to the log in the result list and navigate from the price change document to the display
of the accounting documents. Do not exit the result list.
a) In the SAP Fiori launchpad, choose the tile Release Material Cost Estimate in the tile
group Controlling - Valuation.
b) On the Price Update: Mark Standard Price screen, choose the Release button.
Field Name or Data Type
Value
Posting Period
Current month
Fiscal year
Current fiscal year
Company Code
1010
Plant
1010
Material
T-FL1##
d) Deselect Test run.
e) Choose the Execute button.
f) Choose Back. On the Price Update: Release Standard Price screen, the cost estimate
should have the status FR.
g) Select the Document Number to display the price change document.
h) Choose the Accounting Documents button.
i) In the List of Documents in Accounting dialog box, double-click Accounting document.
Task 7: Display the Material Master Record
Display the material master record of T-FL1##.
1. From the result list, display the material master record of T-FL1## in plant 1010. Go to the
Costing 2 view.
a) On the Price Update: Mark Standard Price screen, select material T-FL1##.
b) Click the Costing 2 tab to see the effect of the price change.
2. What are the prices?
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Duplication is prohibited.
Duplication is prohibited.
c) On the Price Update: Release Standard Price screen, enter the following data:
Lesson: Updating the Material Master
The prices can be seen in the Costing 2 tab.
3. What is the period?
The price comes from the current period in the current fiscal year.
Field
Price for T-FL1##
Period
Result from cost estimate
Current period
Future standard cost estimate price
Current standard cost estimate price
Previous standard cost estimate price
Task 8: Check if the Price Field has Changed
Check if the price field that you entered earlier in the material master of the finished product
T-FL## has changed.
a) In the SAP Fiori launchpad, choose the tile Display Material in the tile group Controlling
- Logistics Master Data.
b) On the Display Material: (Initial Screen) screen, enter T-FL## in the Material field.
c) Choose the Select View(s) button.
d) In the Select View(s) dialog box, select Accounting 2 and Costing 2.
e) Choose the Continue button.
f) In the Organization Levels dialog box, enter 1010 in the Plant field.
g) Choose the Continue button.
2. Has the price field that you entered earlier changed, why?
No price field has changed.
Marking and release was done only for assembly T-FL1##. This does not affect the
remaining assemblies and the final result. If the costing result for material T-FL## should
be written to the standard price field, then you must carry out the marking and release
specifically for this material.
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233
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1. Go to the material master of the finished product T-FL## and select the Costing 2 view.
Unit 5: Material Cost Estimate with Quantity Structure
LESSON SUMMARY
You should now be able to:
●
List the different price fields in the material master
●
Update the standard price in the material master
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234
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Unit 5
Lesson 5
207
Changing Prices in the Material Master
LESSON OVERVIEW
This lesson explains how to change prices in the material master.
Business Example
The prototype of a new product has been successful and production is to commence shortly.
You need to calculate and set an accurate initial standard price. You also need to know how to
change the standard price and the impact the change has on the released standard cost
estimate. For this reason, you require the following knowledge:
●
An understanding of how to change standard price in material master
●
An understanding of how to distinguish between different material cost estimates
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Change prices in the material master
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●
Changing the Standard Price
Figure 87: Changing the Standard Price
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235
Unit 5: Material Cost Estimate with Quantity Structure
You can change the standard price without affecting the released standard cost estimate by
executing price change transaction MR21.
The standard system does not allow this type of price change if a released standard cost
estimate exists. You may grant authorization through user-defined error management in
customizing for the material ledger to allow this.
Changing the material standard price creates a material document and generates accounting
documents.
The standard price is changed with transaction MR21. However, the released standard price
and its link to the standard cost estimate remain.
Note:
The effects of the price change in Cost Object Controlling and in the valuation in
profitability analysis.
You can change the standard price change and alter the released standard cost estimate by
deleting the cost estimate and executing a new one.
Delete the cost estimate by using the Delete Test Data menu option. When you delete the
current standard cost estimate, the system removes the cost component split and
itemization from the database. The system also deletes the link to the material master, and
the current planned price is set to 'blank'. At this phase there is still no change to the standard
price.
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In both the methods, inventory will be revaluated resulting in an impact on the account
balance in financial accounting.
Distinguishing Between Material Cost Estimates
Figure 88: Distinguishing Between Material Cost Estimates
236
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After deletion, execute a new, corrected standard cost estimate and proceed with the price
update process described in the previous lesson.
Lesson: Changing Prices in the Material Master
If you create more than one cost estimate for the same material, the following parameters
need to be checked:
●
Proportion of costs attributable to technical and organizational improvements:
For example, use of current quantity structure and valuation at historical prices.
Subsequent comparison with standard cost estimate.
●
Influence of changed raw material prices and potential wage increases:
For example, use of historical quantity structure and valuation with current or future
prices. Subsequent comparison with standard cost estimate.
●
Breakdown of current costs:
For example, current quantity structure with current prices.
●
“What If” scenarios:
For example, maintaining and valuating make-or-buy decisions, prices, quantities, and
structures under a separate version.
How to Change the Standard Price
Attempt to change the price of T-FL## and double-click the error message to show details
for the message.
2. Attempt to create another cost estimate for T-FL##, costing variant PPC1, plant 1010,
using today’s date as the ‘from’ date. Highlight the system error message stating that this
is not possible.
3. Show the current material master record, both the accounting 1 and costing 2 views.
Display the cost estimate, highlighting the period and status.
4. To delete the cost estimate, on the Fiori Launchpad, Controlling – Valuation group, choose
the Reorganize Cost Estimates tile. Enter T-FL## and plant 1010. Select Current Standard
Cost Estimates and deselect Test Run. Execute the transaction.
5. Return to the material master. Display the accounting 1 view and show that the current
standard price did not change. Go to the costing 2 view and show that the Current planned
price field is blank. Attempt to display the same cost estimate. It is no longer available.
6. Create a new cost estimate for T-FL##. Point out that the system did not issue the error
message regarding existing cost estimate.
LESSON SUMMARY
You should now be able to:
●
Change prices in the material master
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237
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1. To demo the price update, on the Fiori Launchpad, search for the Change Material Costs
tile. Explain the transaction usage as it relates to changing the standard without using a
cost estimate.
Unit 5: Material Cost Estimate with Quantity Structure
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238
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Unit 5
211
Learning Assessment
1. What is the correct sequence to perform costing?
Choose the correct answer.
X
A Finished products, followed by semi-finished products, followed by raw materials
and purchased parts
X
B Raw materials and purchased parts, followed by semi-finished products, followed
by finished products
X
C Finished products, followed by raw materials and purchased parts, followed by
semi-finished products
2. A routing can contain multiple materials involved in the same production process.
X
True
X
False
3. Which of the following functions can the control key in a work center operation specify?
Choose the correct answers.
X
A Dimension
X
B Keyword
X
C Capacity planning
X
D Costing
4. The parameter key specifies which of the following functions?
Choose the correct answers.
X
A Scheduling
X
B Dimension
X
C Keyword
X
D Capacity planning
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239
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Duplication is prohibited.
Determine whether this statement is true or false.
Unit 5: Learning Assessment
5. The work center describes the quantity of an activity and the location of the operations.
Determine whether this statement is true or false.
X
True
X
False
6. The quantity structure control ID describes a list of priorities for the bill of material and
routing through _____________________ and __________________________.
Choose the correct answers.
X
A Routing selection keys
X
B Costing variant
X
C Quantity structure
X
D Bill of material application
7. Which parameters are used by the selection ID to determine which routing it selects first?
X
A Task list type
X
B Plan status
X
C Task list usage
X
D Task list plan
8. The explanation facilities enable the cost planner to access the master data directly from
the cost estimate screen.
Determine whether this statement is true or false.
X
True
X
False
9. You can create your own display variants for displaying error logs.
Determine whether this statement is true or false.
240
X
True
X
False
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Duplication is prohibited.
Choose the correct answers.
Unit 5: Learning Assessment
10. Which dates are proposed by the system from the costing variant?
Choose the correct answers.
X
A Validity dates (from/to) of the cost estimate
X
B Bill of material date
X
C Valuation date
X
D Routing date
X
E Quantity structure date
11. Which of the following prices can you use to valuate the materials in the cost estimate?
X
A Tax-based prices
X
B Planned prices 1, 2, and 3
X
C Price control
X
D Commercial prices
12. The system uses the itemization of standard cost estimates to determine:
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Choose the correct answer.
Choose the correct answer.
X
A Actual costs for manufacturing order
X
B Revenues of the billed quantity
X
C Cost component split of the product
X
D Target costs for manufacturing order
13. The system can detect content errors, such as incorrect prices or quantities.
Determine whether this statement is true or false.
X
True
X
False
14. Release converts the future standard price to the current standard price.
Determine whether this statement is true or false.
X
True
X
False
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241
Unit 5: Learning Assessment
15. Which of the following items is not removed from the database when you delete the
current standard cost estimate?
Choose the correct answer.
X
A Standard price
X
B Cost component split
X
C Itemization
X
D Link to material master
16. Authorization has to be granted in order to make changes to the standard price without
making changes to the standard cost estimate.
Determine whether this statement is true or false.
X
True
X
False
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Duplication is prohibited.
242
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Unit 5
215
Learning Assessment - Answers
1. What is the correct sequence to perform costing?
Choose the correct answer.
X
A Finished products, followed by semi-finished products, followed by raw materials
and purchased parts
X
B Raw materials and purchased parts, followed by semi-finished products, followed
by finished products
X
C Finished products, followed by raw materials and purchased parts, followed by
semi-finished products
Correct. The sequence for costing is first raw materials and purchased parts, followed by
semi-finished products, and ending with finished products.
Determine whether this statement is true or false.
X
True
X
False
Correct! Routings can contain multiple materials.
3. Which of the following functions can the control key in a work center operation specify?
Choose the correct answers.
X
A Dimension
X
B Keyword
X
C Capacity planning
X
D Costing
Correct! The control key can affect capacity planning and costing.
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243
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Duplication is prohibited.
2. A routing can contain multiple materials involved in the same production process.
Unit 5: Learning Assessment - Answers
4. The parameter key specifies which of the following functions?
Choose the correct answers.
X
A Scheduling
X
B Dimension
X
C Keyword
X
D Capacity planning
Correct! The standard value key enables you to define up to six standard values for an
operation. The system assigns a parameter key to the standard values of the operation
and the work in the network activity. This parameter key specifies the keyword appearing
with the standard value on the screen, dimension (time, quantity, volume, and so on) in
which the standard values must be maintained and it also represents the names of the
formula parameters. You can use the formula parameters to represent the standard
values in a formula to determine the execution time, capacity requirements, and costs.
5. The work center describes the quantity of an activity and the location of the operations.
X
True
X
False
Correct! You have controls for how the activities for a work center can be planned and
measured, but not quantity or location in and of itself.
6. The quantity structure control ID describes a list of priorities for the bill of material and
routing through _____________________ and __________________________.
Choose the correct answers.
X
A Routing selection keys
X
B Costing variant
X
C Quantity structure
X
D Bill of material application
Correct! The BOM application and routing selection keys are the objects that define the
prioritization of items.
244
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Duplication is prohibited.
Determine whether this statement is true or false.
Unit 5: Learning Assessment - Answers
7. Which parameters are used by the selection ID to determine which routing it selects first?
Choose the correct answers.
X
A Task list type
X
B Plan status
X
C Task list usage
X
D Task list plan
Correct! The task list plan is not checked.
8. The explanation facilities enable the cost planner to access the master data directly from
the cost estimate screen.
Determine whether this statement is true or false.
X
True
X
False
Correct! You can directly get to the master data details from the cost estimate.
Determine whether this statement is true or false.
X
True
X
False
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Duplication is prohibited.
9. You can create your own display variants for displaying error logs.
Correct! You can select which information is shown.
10. Which dates are proposed by the system from the costing variant?
Choose the correct answers.
X
A Validity dates (from/to) of the cost estimate
X
B Bill of material date
X
C Valuation date
X
D Routing date
X
E Quantity structure date
Correct! The costing variant defines the default validity, valuation and quantity structure
dates.
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245
Unit 5: Learning Assessment - Answers
11. Which of the following prices can you use to valuate the materials in the cost estimate?
Choose the correct answer.
X
A Tax-based prices
X
B Planned prices 1, 2, and 3
X
C Price control
X
D Commercial prices
Correct! The planned prices can be used to perform additional valuations.
12. The system uses the itemization of standard cost estimates to determine:
Choose the correct answer.
X
A Actual costs for manufacturing order
X
B Revenues of the billed quantity
X
C Cost component split of the product
X
D Target costs for manufacturing order
13. The system can detect content errors, such as incorrect prices or quantities.
Determine whether this statement is true or false.
X
True
X
False
Correct! The system cannot detect errors due to wrong inputs.
14. Release converts the future standard price to the current standard price.
Determine whether this statement is true or false.
X
True
X
False
Correct! The purpose of the release is to update the current standard price with the
calculated future standard price.
246
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Correct! Itemization is used to determine target costs.
Unit 5: Learning Assessment - Answers
15. Which of the following items is not removed from the database when you delete the
current standard cost estimate?
Choose the correct answer.
X
A Standard price
X
B Cost component split
X
C Itemization
X
D Link to material master
Correct! The standard cost will remain in the materials master.
16. Authorization has to be granted in order to make changes to the standard price without
making changes to the standard cost estimate.
Determine whether this statement is true or false.
X
True
X
False
Correct! Not all users can change the price directly.
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247
Unit 5: Learning Assessment - Answers
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248
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UNIT 6
Costing Run
Lesson 1
Using Costing Runs in Product Cost Planning
Exercise 12: Use a Costing Run
250
259
Lesson 2
Analyzing the Results of a Costing Run
Exercise 13: Review the Results of a Costing Run
265
269
●
Process a costing run
●
Review the results of a costing run
●
Handle errors in the costing run
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UNIT OBJECTIVES
249
Unit 6
Lesson 1
222
Using Costing Runs in Product Cost Planning
LESSON OVERVIEW
This lesson shows how to process a costing run. It also explains how to create a selection list
using flexible material selection for a costing run.
Business Example
●
An understanding of costing runs
●
An understanding of flexible material selection for a costing run
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In the process of material costing, you need to provide cost estimates, such as standard,
modified, and other cost estimates, for the products and materials in your company. You
want to use the costing run as a tool for product cost planning to process this mass data. You
have to monitor cost changes by comparing the costs from time to time. You also need to
analyze and account for cost variances, and correct errors in the master data and price
maintenance. For this reason, you require the following knowledge:
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Process a costing run
Costing Run Process Flow
Figure 89: Overview: Costing Run
Costing run is a tool used for mass processing in Product Cost Planning (PCP).
250
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Lesson: Using Costing Runs in Product Cost Planning
The following scenarios are some examples of using the costing run:
●
Standard cost estimate of all the materials in one plant
●
Standard cost estimate of all the materials in all plants
●
Monthly modified standard cost estimate of all materials
●
Current cost estimate of all materials of a product group
●
Current cost estimate of a highly complex product structure
The costing run organizes the processing steps and checks the generated material cost
estimates. After a costing run and its processing steps are successfully completed, the
costing run can be deleted.
The administrative data in the costing run is also deleted, but the material cost estimates that
a costing run generates remain and can be reorganized or archived.
Process Flow
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Figure 90: Costing Run: Process Flow
After each processing activity, you can study the activity in the message log. If required,
repeat the activity until costing is free of errors.
For example, if some materials are costed with errors, the costing activity is only repeated for
these materials until the errors are rectified and before a price update is performed.
In the case of partial selection of assemblies for the costing run, the structure of the
assemblies must be exploded again after the selection. If you repeat the selection activity, the
structure explosion must also be repeated.
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251
Unit 6: Costing Run
Flexible Material Selection
Emphasize the business benefits and the ease of use of flexible material selection. After the
materials list is prepared, individual materials can be manually deleted from the list.
Some advantages of flexible material selection are as follows:
●
Business value
Flexible selection of materials for costing enables more precise selection of materials in
support of the cost estimator’s requirements.
●
Realization
There is a separate transaction to maintain the parameters to select materials and
generate the selection list.
The selection of materials can be restricted through material number, plant, bill of material
(BOM) usage, additional material master fields found in the accounting and costing views,
criteria for existing cost estimates, and referencing materials from an existing costing run.
After the initial material list is created, you can edit the selection list by adding or deleting
materials from the selection list.
You can use a selection list to select materials for a costing run by assigning the selection
list to the selection step.
252
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Figure 91: Flexible Material Selection
Lesson: Using Costing Runs in Product Cost Planning
Figure 92: Creation and Use of Selection List
Materials can be selected using the following material master fields from the accounting and
costing views:
●
Profit center
●
Valuation class
●
Special procurement type
Materials can also be selected based on the following characteristics of previous cost
estimates:
●
Costing variant
●
Costing dates
●
Costing status
The materials selected can be manually edited using the transaction CKMATCON. The
selection list can be used in future costing runs, if required.
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253
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Duplication is prohibited.
Creation and Use of Selection List
Unit 6: Costing Run
Facilitator
Producer
Say:
-
-
"We are going to complete a brainstorming and group collaboration activity
now".
Do:
-
Assist the instructor with compiling the
results and commenting on them.
"I would like you to take two minutes and
write some responses to the question in
your participant handbook".
Wait for two minutes.
"Now go ahead and enter your ideas in the
chat pod that I have opened for this activity.
Remember to enter only one idea per line".
Do:
-
-
-
-
254
Explain that the participants should answer each question with as many responses as possible and that each response will be on a separate line in the
chat area.
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Duplication is prohibited.
-
Remind participants of the rules of brainstorming.
Each brainstorming session should last
45–60 seconds only.
Launch a whiteboard overlay and then
debrief by typing the most common
ideas on the slide and making use of the
annotation tools.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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Lesson: Using Costing Runs in Product Cost Planning
INTERACTIVE ELEMENT: Chat
1. Take five minutes and write some responses to the following question in your
participant handbook:
What are the benefits and uses of flexible material selection?
.
.
.
.
.
.
.
.
.
.
Costing Run Creation
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Figure 93: Costing Run Creation
A costing run is identified by its name and the date. The recommendation is to use the long
text to explain the purpose of costing (such as “Plan 04/2000, plant 0001”).
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255
Unit 6: Costing Run
Note:
It is possible to have multiple costing runs with the same name, but with different
run dates.
The Create with reference option allows you to transfer all the parameters (the general data
and process flow parameters) of an existing costing run.
As a rule, you should execute costing runs for the same plants on a monthly, quarterly, or
yearly basis. If you use the Create with reference function all the necessary data and
parameters are copied. All you need to do is alter the names and long text, and execute the
process.
You have to make the following important entries in the General Data section before
executing a costing run:
●
Costing variant and version
The costing variant specifies the explosion and valuation strategies.
●
Company code and controlling area
You need to enter only the company code if the costing run is limited to one company
code, and cross-company costing has not been enabled in customizing.
●
Server group
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You must save the general data before you can initiate the costing run.
Costing Run Execution
Figure 94: Costing Run Execution
The following activities take place during the execution of a costing run:
256
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You need to enter a server group only if you use parallel processing. This is required only
for extremely large quantities of data.
Lesson: Using Costing Runs in Product Cost Planning
●
●
●
●
●
Processing activities are offered according to the context. They are arranged and flow
from left to right and top to bottom. You can execute the activities by either clicking icons
(hotspots) or context menus.
Processing activities are categorized as Change parameters and Execute. The functions of
the Parameters column (Change parameters) enable you to check or maintain the options
of the activity (for example, the material numbers for selection).
Choosing Execute initiates or schedules the processing activity. Other columns that are
used to execute a function are Authorization and Log. The symbol in the Authorization
column indicates if marking or release is permitted (open or closed padlock) or if issuing
authorization is not possible (red cross). Choosing the padlock takes you to the screen
used to issue authorization. The Authorization column displays only for standard cost
estimates. Choosing the Log column takes you to the log.
The Background processing option enables you to specify if processing should take place
in the foreground or in the background. When you choose Execute, the system either
starts the activity or schedules it in the background.
Statistics are generated for each activity.
Use the "Process a Costing Run" exercise as a demonstration.
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257
Unit 6: Costing Run
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258
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Unit 6
Exercise 12
229
Use a Costing Run
Business Example
To cost materials efficiently, you need to use the costing run to simultaneously cost multiple
materials with their assemblies and material components. You need to execute the various
activities of the costing run and use the analysis options.
Task 1: Create a Flexible Selection List
1. Create a flexible selection list to select materials for your costing run. Select materials TFL## and T-FSP1## for plant 1010.
2. Assign the name Select## to your selection list. Enter a short description of your choice.
Task 2: Create a Costing Run
Create a costing run with the name GR## using the current date as the costing run date.
1. Enter the description Group ## mid-year cost estimate. Use costing variant PPC1
and costing version 01. Execute the costing run for controlling area A000 and company
code 1010.
2. The cost estimate is to be marked and released today. Make the relevant date settings.
3. Save the costing run and stay on the screen.
Task 3: Assign your Flexible Selection List for Material Selection
Assign your flexible selection list Select## for material selection. Execute the selection step
and check the costing result.
1. Display the process activities for the costing run and assign your flexible selection list
Select## for material selection. In the processing options, deselect the indicator for
background processing and save your entries.
2. Execute the selection step. The preselection of materials should display two materials with
the status SE (selected without errors). Check the costing result in the list of costing
levels.
Task 4: Proceed with the Costing Step
1. Go to the parameter maintenance for the costing step and deselect Background
Processing. Make sure that the log is set for costing levels.
2. After saving the settings, execute costing.
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259
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Duplication is prohibited.
Note:
Ensure that you only select the products of your group through the Multiple
Selection function for the materials.
Unit 6: Costing Run
3. From the materials overview, check that all the costed materials have a yellow or green
traffic light.
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260
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Unit 6
Solution 12
231
Use a Costing Run
Business Example
To cost materials efficiently, you need to use the costing run to simultaneously cost multiple
materials with their assemblies and material components. You need to execute the various
activities of the costing run and use the analysis options.
Task 1: Create a Flexible Selection List
1. Create a flexible selection list to select materials for your costing run. Select materials TFL## and T-FSP1## for plant 1010.
a) In the SAP Fiori launchpad, choose the tile Create Selection Lists in the tile group
Controlling - Valuation.
b) On the Create Selection List screen, choose the Multiple Selection function for the
Material field.
c) On the Select Single Values tab page, enter material number T-FL## in the first row
and T-FSP1## in the second row.
d) Choose the Copy button.
e) In the Plant field, enter 1010.
2. Assign the name Select## to your selection list. Enter a short description of your choice.
a) Enter Select## in the Selection List and a short description. Choose Execute.
b) Save the selection list.
Task 2: Create a Costing Run
Create a costing run with the name GR## using the current date as the costing run date.
1. Enter the description Group ## mid-year cost estimate. Use costing variant PPC1
and costing version 01. Execute the costing run for controlling area A000 and company
code 1010.
a) In the SAP Fiori launchpad, choose the tile Edit Costing Run in the tile group Controlling
- Valuation.
b) On the Edit Costing Runs screen, choose Create Costing Run → Create.
c) On the Create Costing Run screen, enter the following data:
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261
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Duplication is prohibited.
Note:
Ensure that you only select the products of your group through the Multiple
Selection function for the materials.
Unit 6: Costing Run
Field Name or Data Type
Value
Costing Run
GR##
Description
Group ## mid-year cost estimate
Costing Run Date
Current date
Costing Variant
PPC1
Costing Version
01
Controlling Area
A000
Company Code
1010
d) Choose Enter and click on the green check button.
2. The cost estimate is to be marked and released today. Make the relevant date settings.
Field Name or Data Type
Value
Costing Date From
Current date
Costing Date To
Maximum date
Qty Structure Date
Accept the default date
Valuation Date
Accept the default date
3. Save the costing run and stay on the screen.
a) Save the run by choosing Costing Run → Save.
Note:
You are now at the editing stage of the costing run. The system displays
the overview of the processing activities to be done.
Task 3: Assign your Flexible Selection List for Material Selection
Assign your flexible selection list Select## for material selection. Execute the selection step
and check the costing result.
1. Display the process activities for the costing run and assign your flexible selection list
Select## for material selection. In the processing options, deselect the indicator for
background processing and save your entries.
a) On the Edit Costing Run screen, for the Selection step, click the icon in the Parameter
column.
The system displays the Costing Run: Selection - Change Parameters screen for the
Selection step.
b) Enter Select## in the Selection List field.
c) In the Processing Opts screen area, deselect Background Processing.
d) Save your entries, and return to the Edit Costing Run screen.
262
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a) On the Dates tab, enter the following data:
Lesson: Using Costing Runs in Product Cost Planning
2. Execute the selection step. The preselection of materials should display two materials with
the status SE (selected without errors). Check the costing result in the list of costing
levels.
a) For the Selection step, you can now see the Execute symbol in the Execute column.
b) Choose the Execute symbol to proceed with this step.
c) Expand Costing Results.
d) Select the costing level 1 line.
e) Choose the Materials Overview button.
You will see that the two materials T-FL## and T-FSP1## were selected without errors
in costing level 1.
Task 4: Proceed with the Costing Step
1. Go to the parameter maintenance for the costing step and deselect Background
Processing. Make sure that the log is set for costing levels.
a) For the Costing step, choose the Change Parameter icon in the Parameter column.
The system displays the Costing Run: Cost Estimate - Change Parameters screen for
this step.
b) Deselect Background Processing.
2. After saving the settings, execute costing.
a) Save the setting, and return to the Edit Costing Run screen.
b) For the Costing step, you can now see the Execute symbol in the Execute column.
c) Choose the Execute symbol to proceed with this step.
3. From the materials overview, check that all the costed materials have a yellow or green
traffic light.
a) In the Costing Results section, choose the Materials Overview button. You will see that
all materials have either a yellow or a green traffic light. If any items have a red light
they will not be released. Evaluate the errors.
b) Remain on this screen for the next exercise.
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c) Select Log by Costing Level.
Unit 6: Costing Run
LESSON SUMMARY
You should now be able to:
●
Process a costing run
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Unit 6
Lesson 2
235
Analyzing the Results of a Costing Run
LESSON OVERVIEW
This lesson shows you how to analyze the results and solve the errors of a costing run.
Business Example
Now that you know how to create and execute a Costing Run, you need to be able to extract
useful information from the results that will help you make the right business decisions. You
also need to understand what might go wrong during the costing run execution and how to fix
errors. For this reason, you require the following knowledge:
●
An understanding of how to review and analyze the results of a costing run
●
An understanding of how to handle errors in the costing run
●
Review the results of a costing run
●
Handle errors in the costing run
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Duplication is prohibited.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Costing Results
Figure 95: Costing Results
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265
Unit 6: Costing Run
You can analyze the results of the cost estimate in the Costing Results area. You can obtain
an overview of the material selected or check the results of individual cost estimates.
The following reports are used to analyze the results of the cost estimate:
●
Costing levels report:
The costing levels report provides an overview of the number of materials selected and
costing levels created. The lowest level contains the material components, purchased
parts, and raw materials. If you select some specific costing levels and go to the material
list, the system displays the materials of only the selected levels.
●
Material list report:
The material list report contains the list of selected materials. You can also check the
status of the cost estimate for the material. There are several navigation options, such as
the context menu, double-click, and the toolbar menu, which can be used to access more
cost estimate screens and reports.
●
Analysis report:
The analysis report enables you to compare the costing results of one costing run with
another or with the prices in the material master. This report is generated by the identical
processing activity in the Analysis area. You can also access comparison reports.
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Duplication is prohibited.
The Analysis option is used to compare new standard cost estimates with the standard price.
You can use it to check if any cost estimates are undergoing major changes. When there are
large amounts of data, you can quickly display the analysis reports that were created in the
background.
Costing Run Analysis
Figure 96: Costing Run Analysis
266
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Lesson: Analyzing the Results of a Costing Run
The standard system provides several variants of the analysis report for various analysis
purposes. You can access these reports either in the costing run by choosing the Settings
menu inside the costing run transaction or through Fiori reporting apps.
The following information is included in the analysis report:
●
Results of costing run
The results of costing run report variant displays the results of a costing run.
●
Price versus cost estimate
The price versus cost estimate report variant compares the selected cost estimates with
one of the prices in the material master. You can simulate the revaluation of inventories to
find out whether the selected cost estimates are released.
●
Variances between costing runs
The variances between costing runs report compares the results of two costing runs.
To get an overview of all report options, use the All selections option.
You can go from the object list to detailed reports such as display cost estimate, multi-level
bill of material (BOM), itemization, and cost component split.
Information System: Analyzing the Costing Run
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Duplication is prohibited.
Figure 97: Information System: Analyzing the Costing Run
The costing run permits only one analysis from within the transaction, but the information
system permits the use of various reports to review a costing run.
The Analysis option in the costing run enables only one mass report for a single costing run.
When analysis is performed again, the old result is overwritten.
The Analyze Costing Run report in the information system does not have this restriction. It
can cover information contained in multiple costing runs. Time-consuming retrieval and
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267
Unit 6: Costing Run
formatting of mass data is performed in the background and an extract is generated. The
extract is interactive and can be displayed quickly. The most important feature of the Analyze
Costing Run report is the interplay between selection variants, display variants, and extracts.
To execute the Analyze Costing Run report, take the following steps:
1. Define and use appropriate display variants (including totals, sorting, and filters).
2. Define and use appropriate selection variants that are assigned to the display variants.
3. Specify the extracts in which the content should be saved.
4. Start background processing with the defined selection variants.
5. To call the report, specify the extract to be read. In the displayed extract, you can use the
sorting, filtering, and totalling functions and go to the detailed reports.
Use the exercise “Review the Results of a Costing Run” as a demonstration.
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268
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Unit 6
Exercise 13
239
Review the Results of a Costing Run
Business Example
You want to simultaneously cost multiple materials with their assemblies and material
components. You want to execute the various activities of the costing run and use the
analysis options to compare the results of two costing runs to find out any variance in the
pricing.
Review the results of a costing run using reports.
Task 1: Analyze the Costing Results Using Special Reports
1. In the analysis parameters, select display variant SAP&11. Using the parameters, select
your costing run GR## with the relevant costing date and save it.
3. From the report, display the multi-level BOM report.
Task 2: Check the Costing Results for a Material
Execute the update run and check the costing results for a material.
1. Mark the costing results. First, check whether marking has been allowed in the current
period for your costing variant.
2. Turn off background processing and test run indicators in the parameter settings. Execute
the update run.
3. From the materials overview, check the costing result for a given material.
4. Go to the material master (Costing 2 view) for the materials in the cost estimate. Make
sure that the Future Planned price field has been updated.
Task 3: Display the Financial Accounting Document and the Activities Performed in
Costing Run
Release the costing results and check the standard results of the release in the Accounting 1
and Costing 2 views. Display the financial accounting document for the revaluation of
inventory. Finally, display the activities that were performed in the costing run.
1. Release the costing results. Make sure that the release will be carried out in the
foreground and then execute the release. Do not execute a test run.
2. On the Price Update: Release Standard Price screen, check that all materials have the
status FR (Released without Errors). Navigate to the material master directly from the
Price Update: Release Standard Price screen by selecting the material. Check the standard
results of the release in the Accounting 1 and Costing 2 views.
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2. Execute the analysis and select a layout that compares the costing result with the
standard price for every material, in order to see the impact that will occur if these results
are released as the new standard cost.
Unit 6: Costing Run
3. From the Price Update: Release Standard Price screen, display the financial accounting
document for the revaluation of inventory. Which materials caused the inventory balance
to be revalued?
4. On the Edit Costing Run screen, go to the overview of the costing run in the Schedule
Manager to display the activities that were performed in the costing run.
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270
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Unit 6
Solution 13
241
Review the Results of a Costing Run
Business Example
You want to simultaneously cost multiple materials with their assemblies and material
components. You want to execute the various activities of the costing run and use the
analysis options to compare the results of two costing runs to find out any variance in the
pricing.
Review the results of a costing run using reports.
Task 1: Analyze the Costing Results Using Special Reports
1. In the analysis parameters, select display variant SAP&11. Using the parameters, select
your costing run GR## with the relevant costing date and save it.
b) In the Choose Reference for Selection Parameter dialog box, select variant SAP&11
Results of Costing Run.
c) Choose the Continue push button.
d) On the Costing Run: Analysis - Change Parameters screen, enter the following data:
Field Name or Data Type
Value
Costing Run
GR##
Costing Date
Current date
e) Save your settings and go back to the Edit Costing Run screen.
2. Execute the analysis and select a layout that compares the costing result with the
standard price for every material, in order to see the impact that will occur if these results
are released as the new standard cost.
a) On the Edit Costing Run screen, for the Analysis step, choose the Execute symbol in
the Execute column.
b) On the Analyze/Compare Material Cost Estimates screen, select the Choose Layout
button.
c) In the Choose Layout dialog box, select layout 1SAP03 Standard price vs cost est/
revaluation.
d) Select continue past the information message.
3. From the report, display the multi-level BOM report.
a) Select the row for T-FSP1## .
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a) On the Edit Costing Run screen, for the Analysis step, choose the Change Parameter
icon in the Parameter column.
Unit 6: Costing Run
b) Choose the Detailed Report: Multi-level BOM button.
Task 2: Check the Costing Results for a Material
Execute the update run and check the costing results for a material.
1. Mark the costing results. First, check whether marking has been allowed in the current
period for your costing variant.
a) Go back to the Edit Costing Run screen.
b) For the Marking step, choose the Lock symbol in the Authorization column.
c) On the Price Update: Organizational Measure screen, choose company code 1010. You
see that marking (and release) is allowed for the costing variant PPC1. You assigned
this costing variant in the parameters for the costing run. Choose Issue allowance for
marking.
d) Go back to the Edit Costing Run screen.
2. Turn off background processing and test run indicators in the parameter settings. Execute
the update run.
a) On the Edit Costing Run screen, for the Marking step, choose the Change Parameter
icon in the Parameter column.
b) On the Price Update: Mark Standard Price screen, deselect Background Processing and
Test Run.
c) Save your entries.
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e) Choose the Execute symbol to proceed with Marking.
3. From the materials overview, check the costing result for a given material.
a) Go to the Materials Overview screen in the costing results.
b) Double-click any material number. You can see the costing result in detail (multi-level
BOM, cost views, and itemization).
4. Go to the material master (Costing 2 view) for the materials in the cost estimate. Make
sure that the Future Planned price field has been updated.
a) On the Materials Overview screen, place your cursor on a material. Choose the Goto
icon. Select Extras → Material Master.
b) Scroll along the tabs until you reach Costing 2. You can see the result of your marking
in the Future Planned Price field.
Task 3: Display the Financial Accounting Document and the Activities Performed in
Costing Run
Release the costing results and check the standard results of the release in the Accounting 1
and Costing 2 views. Display the financial accounting document for the revaluation of
inventory. Finally, display the activities that were performed in the costing run.
1. Release the costing results. Make sure that the release will be carried out in the
foreground and then execute the release. Do not execute a test run.
272
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d) Go back to the Edit Costing Run screen. For the Marking step, you can now see the
Execute symbol in the Execute column.
Lesson: Analyzing the Results of a Costing Run
a) On the Edit Costing Run screen, for the Release step, choose the Change Parameter
icon in the Parameter column.
b) On the Price Update: Release Standard Price screen, deselect Background Processing
and Test Run.
c) Save your settings and go back to the Edit Costing Run screen. You can now see the
Execute symbol in the Execute column for the Release step.
d) Choose the Execute symbol to proceed with the release.
2. On the Price Update: Release Standard Price screen, check that all materials have the
status FR (Released without Errors). Navigate to the material master directly from the
Price Update: Release Standard Price screen by selecting the material. Check the standard
results of the release in the Accounting 1 and Costing 2 views.
a) The Price Update: Release Standard Price screen is displayed immediately after the
release of cost estimates is executed. On the Price Update: Release Standard Price
screen, the costing status is displayed. You will see that all the materials have the
status FR (Released without Errors).
c) On the Costing 2 tab, you can see the result of your release in the Current Planned
Price field. You can also see the new standard price on the Accounting 1 tab. Any
materials in existing stock subject to standard price control are revaluated with this
price.
3. From the Price Update: Release Standard Price screen, display the financial accounting
document for the revaluation of inventory. Which materials caused the inventory balance
to be revalued?
a) Choose the document number for the price change in the Price Update: Release
Standard Price screen. The price change document lists the old and new price for each
material included in the costing run.
b) Choose the Accounting Documents button to display the revaluation document.
c) From the list of accounting documents, double-click Accounting Document.
d) To display the material in the accounting document, choose select different display
variant and use the /S45 layout .
An inventory revaluation occurs for a material if the stock is present in the warehouse
at the time of a new standard price release. Therefore, the materials in the warehouse
caused the inventory balance to be revalued.
4. On the Edit Costing Run screen, go to the overview of the costing run in the Schedule
Manager to display the activities that were performed in the costing run.
a) On the Edit Costing Run screen, choose More → Go to → Schedule Manager.
A list of the activities you have performed is displayed.
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273
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b) Remain in the Price Update: Release Standard Price screen and choose the material
overview tab, then choose any material. This takes you to the material master. Scroll
along the tabs until you reach Accounting 1 and Costing 2.
Unit 6: Costing Run
Error Handling in the Costing Run
Emphasize the ability to selectively recost only those materials that had errors during the
costing run.
In order to efficiently handle errors in the costing process, you use the following options:
●
Costing by costing level:
-
-
-
●
In the parameters for the costing activity, select the relevant costing levels and proceed
with costing. Select the higher costing level where the material cost estimates of the
lower levels are automatically included.
Process the errors and remove their causes. Perform costing again until the results are
satisfactory.
Cost estimates with errors only:
-
274
When you do costing of mass data for the first time numerous errors usually occur due
to poor master data quality. Therefore, it is recommended to execute costing by
costing level first.
For repeated cost estimates, set the Cost tests with errors only indicator in the
parameters for the costing activity. Carry out cost estimates with cost tests with errors
only when you do not expect many errors for one or more selected costing levels. The
system will repeat the cost estimate generation only for those products where errors
were observed.
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Duplication is prohibited.
Figure 98: Error Handling in the Costing Run
Lesson: Analyzing the Results of a Costing Run
-
When all the costing levels are costed, the error severity of message CK 318 should be
set to Error in the user-defined error message, so that all cost estimates containing
errors are flagged accordingly.
Costing Run: Managing Logs
Based on the size of a costing run, you may need to create a separate log for each costing
level. This makes it easier to analyze the results.
If extremely large costing runs are executed, you can create a log for each costing level. This
makes it easier to analyze the results.
The standard system contains display variants for error logs that enable you to summarize
and group the data. You can define your own display variants for filters and sorting to access
the required data quickly.
You can print the log at each stage of the costing run. This is not recommended for large
costing runs because it increases the processing time and uses a considerable amount of
system resources (spools). Save the log and analyze it later.
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275
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Figure 99: Costing Run: Managing Logs
Unit 6: Costing Run
Facilitator
Producer
Say:
-
You are going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I will give you five minutes to work with
your partner and then we will summarize
briefly as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
276
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
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Lesson: Analyzing the Results of a Costing Run
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
How do you handle errors that occur while doing costing runs. How can managing error
logs help you with analyzing them?
Using private chat, take five minutes and discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
How to Handle Errors in the Costing Run
1. From the costing run, show the ability to select only those materials with errors for the
costing activity.
2. Go to the parameters of the costing activity. Show the indicator log by costing level.
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277
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Duplication is prohibited.
.
Unit 6: Costing Run
LESSON SUMMARY
You should now be able to:
●
Review the results of a costing run
●
Handle errors in the costing run
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278
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Unit 6
249
Learning Assessment
1. While creating a costing run, if some materials are costed with errors, the costing activity
is only repeated for these materials before price update is performed.
Determine whether this statement is true or false.
X
True
X
False
2. The costing run organizes the processing steps and checks the generated material cost
estimates.
X
True
X
False
3. The selection list can be used to select materials for a costing run by assigning the
___________ to the selection step.
Choose the correct answer.
X
A Material number
X
B Selection list
X
C Product
4. Which parameters are required to create a costing run?
Choose the correct answers.
X
A Company code
X
B Profit center
X
C Costing variant
X
D Costing dates
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279
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Duplication is prohibited.
Determine whether this statement is true or false.
Unit 6: Learning Assessment
5. The Analysis option in the costing run enables only one mass report. When analysis is
performed again, the old result is ________________.
Choose the correct answer.
X
A overwritten
X
B saved
X
C archived
6. You need to print the log at each stage of a large costing run.
Determine whether this statement is true or false.
X
True
X
False
7. The cost estimates with errors only procedure is used when only few errors are expected
in the costing run.
280
X
True
X
False
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Duplication is prohibited.
Determine whether this statement is true or false.
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Unit 6
251
Learning Assessment - Answers
1. While creating a costing run, if some materials are costed with errors, the costing activity
is only repeated for these materials before price update is performed.
Determine whether this statement is true or false.
X
True
X
False
Correct! Only the erroneous materials are evaluated in a repeated run.
2. The costing run organizes the processing steps and checks the generated material cost
estimates.
X
True
X
False
Correct! That is the definition of the costing run.
3. The selection list can be used to select materials for a costing run by assigning the
___________ to the selection step.
Choose the correct answer.
X
A Material number
X
B Selection list
X
C Product
Correct! The selection list can be used to select materials for a costing run (transaction
CK40N) by assigning the selection list to the selection step.
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281
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Duplication is prohibited.
Determine whether this statement is true or false.
Unit 6: Learning Assessment - Answers
4. Which parameters are required to create a costing run?
Choose the correct answers.
X
A Company code
X
B Profit center
X
C Costing variant
X
D Costing dates
Correct! The profit center is not relevant.
5. The Analysis option in the costing run enables only one mass report. When analysis is
performed again, the old result is ________________.
Choose the correct answer.
X
A overwritten
X
B saved
X
C archived
6. You need to print the log at each stage of a large costing run.
Determine whether this statement is true or false.
X
True
X
False
Correct! You can review logs at any time.
7. The cost estimates with errors only procedure is used when only few errors are expected
in the costing run.
Determine whether this statement is true or false.
X
True
X
False
Correct! You usually need to select a different option until you have ironed out most
problems.
282
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Duplication is prohibited.
Correct! The previous results are overwritten.
UNIT 7
Additional Costing Functions
Lesson 1
Using Transfer Control
Exercise 14: Use Transfer Control
284
295
UNIT OBJECTIVES
●
Use transfer control functionality
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283
Unit 7
Lesson 1
254
Using Transfer Control
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Use transfer control functionality
Figure 100: Transfer Control: Purpose
You can specify the cost estimates that can be used in customizing for transfer control.
You can define the following strategies for transfer control:
●
Transfer of cost estimates in the same plant
●
Transfer of cross-plant cost estimates
●
Cost estimates with period-based transfer control (cost estimates with the same key, that
is, with the same costing variant, version, and, if applicable, period)
Application: Reference Variant
Explain the business scenario that is supported using the transfer control key. If a new
product is developed during the year or a new standard needs to be created for an existing
product, you may want to use a previously created standard for the components. This can be
done by using the transfer control key. Explain that the transfer control key determines which
284
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Transfer Control
Lesson: Using Transfer Control
existing cost estimates must be reused. Discuss the different applications for transfer control
as defined in the content.
Application of Transfer Control
Transfer control can be customized and used in the following structure:
●
Material cost estimate with quantity structure:
New product with 90% existing assemblies and raw materials
●
Material cost estimate without quantity structure:
Valuation of material item
●
Costing run:
-
●
●
Selection
Cross-company costing:
-
Cross-plant
-
Cross-company-code
Reference variant:
Material Cost Estimate with Quantity Structure
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Duplication is prohibited.
Figure 101: Application: Material Cost Estimate with Quantity Structure
You can avoid costing the entire product structure again by automatically transferring the
existing data, such as released cost estimates for assemblies and raw materials, when you
estimate the cost of a new product.
In customizing, you can define a specific cost estimate for transfer control. The key for
transfer control is assigned to the costing variant. Use of the same cost component structure
is mandatory.
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285
Unit 7: Additional Costing Functions
Application: Material Cost Estimate Without Quantity Structure
Figure 102: Application: Material Cost Estimate Without Quantity Structure
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1. The system searches for a material cost estimate in accordance with transfer control.
2. It then proceeds according to the material valuation strategy. It applies to the following:
●
●
286
Manual entry of a material item.
When entries are made using cut, copy, and paste. This does not apply to multi-level
unit costing when you are transferring cost estimates using drag and drop. In such
cases, you can only transfer the cost estimate as the original or as a copy.
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In material costing without a quantity structure, the transfer strategies in the costing variant
specify the following sequence for material items:
Lesson: Using Transfer Control
Application: Costing Run
You want to ensure that all the materials in your plant have a standard cost estimate. You
need to define a transfer control ID that finds a current standard cost estimate. After selection
(and structure explosion), all the materials that do not have a current standard cost estimate
are displayed.
In the General Data section of the costing run, the costing variant proposes the transfer
control ID. When you select materials, the system also checks whether a material cost
estimate already exists for the material in accordance with transfer control. If it does, the
material is not included in the selection. In the example mentioned in the figure, Forklift P-100
is not selected for this reason.
If you choose Always recalculate, the step for checking transfer control does not apply.
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287
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Duplication is prohibited.
Figure 103: Application: Costing Run
Unit 7: Additional Costing Functions
Facilitator
Producer
Say:
-
"You are going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I will give you five minutes to work with
your partner and then we will summarize
briefly as a group"
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
288
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their participant handbook.
© Copyright. All rights reserved.
Lesson: Using Transfer Control
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
What is a costing run application and what are its uses?
Using private chat, take five minutes to discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
Application: Cross-Plant Costing
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Duplication is prohibited.
Figure 104: Application: Cross-Plant Costing
You may find differences between the production plant and the sales plant. The cost estimate
in the sales plant should match the material cost estimate in the production plant.
In the example, Shaft 100-300 is produced in plant Y. Different costing variants are used in
the plants.
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289
Unit 7: Additional Costing Functions
If a cost estimate is found in another plant, that is, in accordance with transfer control, its cost
component split is transferred directly. As a requirement for cross-plant costing, you must
use the same cost component structure.
Application: Cross-Company Costing
When you cost across company codes, an important factor is whether cross-company
costing has been allowed in customizing.
The example of the conditions whether cross-company costing has been allowed in
customizing is as follows:
●
Not allowed:
The material Shaft 100-300 was valuated in the US plant X in accordance with the material
valuation strategy, although Shaft 100-300 has a cost estimate in the Canadian plant Y.
Transfer control is not taken into account.
●
Allowed:
The cost component split data is retained beyond the company code for internal cost
accounting reasons.
290
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Duplication is prohibited.
Figure 105: Application: Cross-Company Costing
Lesson: Using Transfer Control
Application: Reference Variant
You want to create a modified standard cost estimate based on the quantity structure of the
standard cost estimate.
The actual prices of the previous month are reflected in the product range.
A reference variant allows you to create new material cost estimates or costing runs from the
existing material cost estimates with itemizations.
A reference variant provides support to perform the following tasks:
●
●
Avoid having to both determine the quantity structure and perform the explosion steps
repeatedly.
Carry out an alternative or new valuations based on exactly the same quantity structure.
For processing cost estimates, you can choose between the following reference variants:
●
The material cost estimates that should be searched for transfer control.
●
The costing items that should be revaluated.
You can assign the reference variant to the costing variant in customizing. A material cost
estimate generated by a reference variant is always indicated as a material cost estimate with
a quantity structure.
How to Use a Reference Variant
Create a reference variant and add it to the cost variant PYC2.
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Figure 106: Application: Reference Variant
Unit 7: Additional Costing Functions
If you have limited time, you can perform steps 1-5 ahead of time and show how to create a
new cost estimate for T-FL30 using costing variant PYC2.
1. Verify that you have selected and released a cost estimate for T-FL30. Create a cost
estimate if it has not already been created.
2. Create a new transfer control.
a) In customizing, choose Controlling → Product Cost Controlling → Product Cost
Planning → Material Cost Estimate with Quantity Structure → Costing Variants:
Components → Define Transfer Control.
b) Choose the New Entries button.
c) In the Transfer Control ID field, enter ZC05 and provide a description.
d) On the Single-Plant tab page, select the Current Standard Cost Estimate button in the
Strategy Seq field.
e) Select Fiscal Year.
f) Choose Save.
3. Create a reference variant.
b) Choose the New Entries button.
c) In the Reference Variant ID field, enter 99 and provide a description.
d) On the Cost Estimate Ref tab page, for Transfer Control, select the transfer control key
that you created in the previous step.
e) Choose Save.
4. Add the reference variant to costing variant PYC2.
a) In customizing, choose Controlling → Product Cost Controlling → Product Cost
Planning → Material Cost Estimate with Quantity Structure → Define Costing Variants.
b) On the Change View “Costing Variants”: Overview screen, choose the line for costing
variant PYC2 and choose the Details button.
c) On the Change View “Costing Variants”: Overview screen, for Reference Variant,
choose the reference variant that you created in the previous step.
d) Choose Save.
5. Change the BOM for T-FL30.
a) On the FIORI Launchpad, choose the Display Bill of Material tile and go to the Change
Material BOM window through path More → Material BOM → Change.
b) On the Change Material BOM: Initial screen, enter the following data:
292
Field Name or Data Type
Value
Material
T-FL30
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a) In customizing, choose Controlling → Product Cost Controlling → Product Cost
Planning → Material Cost Estimate with Quantity Structure → Costing Variants:
Components → Define Reference Variants.
Lesson: Using Transfer Control
Field Name or Data Type
Value
Plant
1010
BOM Usage
1
c) Choose Enter and Continue.
d) On the Change Material BOM: General Item Overview screen, choose the New Entries
button.
e) Add component T-PM1000 with quantity of 1 to the bill.
f) Choose Save.
6. Create a new cost estimate for T-F130 using costing variant PYC2.
a) In the FIORI Launchpad, in the Controlling – Valuation Group, choose the Create
Material Cost Estimate tile.
Field Name or Data Type
Value
Material
T-FL30
Plant
1010
Costing Variant
PYC2
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b) On the Create Material Cost Estimate with Quantity Structure screen, enter the
following data:
c) Choose Enter and Continue twice.
The component that you added should not appear in the costing structure.
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Unit 7: Additional Costing Functions
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Unit 7
Exercise 14
261
Use Transfer Control
Business Example
When costing finished goods, you want to prevent subordinate assemblies from being
recosted, provided a released cost estimate already exists. Therefore, you use the transfer
control function. You use the plant-specific transfer strategy because all the assemblies of
your finished product are produced in the same plant.
Task 1: Create a New Cost Estimate
Access the result of the standard cost estimate for assembly T-FL1## and create a new cost
estimate for forklift T-FL##.
2. Create a cost estimate for product T-FL##. Use a transfer control ID that enables you to
utilize the existing cost estimates for your components. Select costing variant PPC1, plant
1010, costing lot size 100 pieces, and costing version 2. The cost estimate should be valid
from the first day of the next period. The cost estimate should be valid until last day of
current year. Accept the default quantity structure date and valuation date.
3. What is the error status of your cost estimate?
4. The costing result of your subordinate components is displayed in the itemization. Where
can you check that the materials were not recosted?
5. Save the result.
Task 2: Determine the Results of Transfer Control
In the previous task, you entered the transfer control ID directly in the request screen of the
cost estimate.
1. How can you enter it centrally? Write down the relevant menu option.
2. What do you have to take into account when transfer control is set centrally?
3. What are the prerequisites for transfer control to access existing cost estimates?
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1. Go to the material master for your component T-FL1## (Costing 2 view) and ensure that
the result of the current posting period was updated in the current planned price field.
Unit 7
Solution 14
262
Use Transfer Control
Business Example
When costing finished goods, you want to prevent subordinate assemblies from being
recosted, provided a released cost estimate already exists. Therefore, you use the transfer
control function. You use the plant-specific transfer strategy because all the assemblies of
your finished product are produced in the same plant.
Task 1: Create a New Cost Estimate
Access the result of the standard cost estimate for assembly T-FL1## and create a new cost
estimate for forklift T-FL##.
1. Go to the material master for your component T-FL1## (Costing 2 view) and ensure that
the result of the current posting period was updated in the current planned price field.
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b) On the Display Material: Initial screen, enter T-FL1## in the Material field and choose
the Select View(s) button.
c) In the Select View(s) dialog box, choose Costing 2 and then choose the Continue
button.
d) In the Organizational Levels dialog box, enter 1010 in the Plant field and choose the
Continue button.
e) On the Display Material T-FL1## (Semi-finished Product) screen, you can see the result
from the current posting period.
2. Create a cost estimate for product T-FL##. Use a transfer control ID that enables you to
utilize the existing cost estimates for your components. Select costing variant PPC1, plant
1010, costing lot size 100 pieces, and costing version 2. The cost estimate should be valid
from the first day of the next period. The cost estimate should be valid until last day of
current year. Accept the default quantity structure date and valuation date.
a) In the SAP Fiori launchpad, choose the tile Create Material Cost Estimate in the tile
group Controlling - Valuation.
b) On the Create Material Cost Estimate with Quantity Structure screen, enter the
following data:
296
Field Name or Data Type
Value
Material
T-FL##
Plant
1010
Costing Variant
PPC1
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a) In the SAP Fiori launchpad, choose the tile Display Material in the tile group Controlling
- Logistics Master Data.
Lesson: Using Transfer Control
Field Name or Data Type
Value
Costing Version
2
Costing Lot Size
100
Transfer Control
PC02
c) On the Dates tab page, choose the Default Values button.
d) On the Dates tab page, enter the following data:
Field Name or Data Type
Value
Costing Date From
First day of next month
Costing Date To
Last date of current year
e) Accept the default quantity structure date and valuation date.
f) Choose Enter and Continue. The system executes the cost estimate automatically.
3. What is the error status of your cost estimate?
a) Go to the Costing data tab page. The costing status should be Costed Without
Errors.
a) Choose More → Goto → Material Overview. Only material T-FL## is displayed. Since
the subordinate assemblies and material components were not recosted, they are not
listed.
5. Save the result.
a) Go back to the overview of the cost estimate and save the result with all the options
selected.
b) Choose the SAP Logo (Navigate to Home Page).
Task 2: Determine the Results of Transfer Control
In the previous task, you entered the transfer control ID directly in the request screen of the
cost estimate.
1. How can you enter it centrally? Write down the relevant menu option.
a) Transfer control can be entered centrally in the costing variant.
b) In customizing, choose Controlling → Product Cost Controlling → Product Cost
Planning → Material Cost Estimate with Quantity Structure → Define Costing Variants.
2. What do you have to take into account when transfer control is set centrally?
a) When you set transfer control centrally, you can decide whether it can be changed in
the application. You make the settings in customizing for the costing variant on the
Quantity Structure tab page.
3. What are the prerequisites for transfer control to access existing cost estimates?
a) When you use transfer control, the cost estimates must be based on the same cost
component structure. This means that the same cost component structure must be
assigned to each costing variant of the company code or plant.
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4. The costing result of your subordinate components is displayed in the itemization. Where
can you check that the materials were not recosted?
Unit 7: Additional Costing Functions
LESSON SUMMARY
You should now be able to:
●
Use transfer control functionality
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298
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Unit 7
265
Learning Assessment
1. In customizing for transfer control, you can specify the cost estimates that can be used.
Determine whether this statement is true or false.
X
True
X
False
2. Transfer control is taken into account when the material has a cost estimate in one plant,
but is valuated by another plant.
X
True
X
False
3. What are the prerequisites for transfer control to access existing cost estimates?
4. The use of the transfer control key is determined by the_______________.
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Determine whether this statement is true or false.
Unit 7
266
Learning Assessment - Answers
1. In customizing for transfer control, you can specify the cost estimates that can be used.
Determine whether this statement is true or false.
X
True
X
False
Correct! In customizing for transfer control, you can specify the cost estimates that can
be used.
2. Transfer control is taken into account when the material has a cost estimate in one plant,
but is valuated by another plant.
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X
True
X
False
Correct! Transfer control is not taken into account when the material has a cost estimate
in one plant, but is valuated by another plant.
3. What are the prerequisites for transfer control to access existing cost estimates?
When you use transfer control, the cost estimates should be based on the same cost
component structure. The same cost component structure should be assigned to each
costing variant of the company code or plant.
4. The use of the transfer control key is determined by the_______________.
costing variant
300
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Determine whether this statement is true or false.
UNIT 8
Cost Object Controlling
Lesson 1
Outline Cost Object Controlling
303
UNIT OBJECTIVES
●
Outline cost object controlling
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301
Unit 8: Cost Object Controlling
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302
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Unit 8
Lesson 1
269
Outline Cost Object Controlling
LESSON OVERVIEW
This lesson provides an overview of Cost Object Controlling.
Business Example
Your company uses various production processes to produce goods and services. You need
to learn about suitable mapping methods for these production processes in the SAP ERP
application. For this reason, you require the following knowledge:
●
An understanding of Cost Object Controlling in the Controlling component
●
An understanding of the terms preliminary costing, simultaneous costing, and final costing
●
An understanding of the differences between product-level and order-level controlling
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
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●
An understanding of the terms Product Cost by Order, Product Cost by Period, and
Product Cost by Sales Order
Outline cost object controlling
SAP S/4HANA Finance Learning Journey
Figure 107: Financial Accounting Learning Journey
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303
Unit 8: Cost Object Controlling
Learning Journeys are visual guides, designed to help you complete the learning path for
particular SAP solutions. The easiest way to find learning journeys is to search for SAP
Learning Journeys in your browser.
Management Accounting
Figure 108: Controlling Architecture – Quantities and Values
The Controlling architecture explains how quantities and values flow between the
components of the SAP S/4HANA application with respect to accounting. Controlling adds
the quantity flows in terms of preliminary costing, simultaneous costing, and final costing.
The typical quantity flows of logistics follow the supply chain sequence for procurement,
production, stock movements, sales, and billing.
Product Cost Controlling (CO-PC) performs the following functions:
●
Valuates material movements
●
Provides cost component splits for valuation in Profitability Analysis (CO-PA)
●
304
Allocates overhead costs from cost centers and business processes to cost objects (such
as production orders, sales order items, and projects)
●
Determines Work in Process (WIP)
●
Determines variances and their settlement to CO-PA
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Controlling Architecture – Quantities and Values
Lesson: Outline Cost Object Controlling
Product Cost Controlling – Benefits
Table 4: Management and Legal Requirements that must be Mapped by CO-PC
Management Requirements
Legal Requirements
Support for cost reduction concepts
Valuation of raw materials, semi-finished
goods, and finished goods
Support for strategic decision-making:
WIP
●
Which products
●
Where or how to produce
Support for operative decision-making in
pricing and manufacturing efficiency
Reserves for imminent losses
The benefits of CO-PC are as follows:
●
●
●
Valuation of manufacturing efficiency
-
Set relevant standards to measure performance
-
Variance analysis
-
Reports for individual plants, product groups, products, or orders
Supports strategic decision-making
-
Primary cost component split and cost component splits by organizational unit
-
Scrap costs, process costs, and overhead allocation
Inventory valuation
-
Alternative valuations according to commercial law, group, and profit center
-
Three parallel currencies
-
Standard costs
-
Actual costs using the actual costing or Material Ledger component
Valuation of finished and semi-finished goods
-
Standard prices provided by cost estimates
-
Creation of alternative cost estimates for balance sheet purposes for closing activities
●
Determination and valuation of WIP at period-end closing
●
Period-based accrual calculation with provisions for imminent losses
-
In a make-to-order (MTO) environment
-
Corresponding updates of balance sheet as well as profit and loss statements
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●
Unit 8: Cost Object Controlling
Product Cost Controlling
Figure 109: Product Cost Controlling – Components (1)
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●
●
●
●
●
306
Helps plan the costing of goods manufactured and services
Allows planning to be performed without any reference to a production order (costing is
carried out independently of any production order)
Allows costing to be carried out automatically when quantity structure data (such as bill of
materials and routing) exists in the production planning (PP) component of SAP
Allows costing items to be entered manually in unit costing or ad hoc costing with no
quantity structure
Allows use of the batch input method to transfer the quantity structure from a remote
system to the SAP S/4 HANA application
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The features of CO-PC are as follows:
Lesson: Outline Cost Object Controlling
Product Cost Controlling – Components (2)
In Cost Object Controlling, the system uses a cost object to collect the costs incurred when a
product or service is created. The cost object to be used depends on your Controlling
requirements. Possible cost objects are sales orders, production orders, process orders,
product cost collectors, and projects, among others. Cost Object Controlling allows
simultaneous costing (mapping and valuating logistical quantity flows) and final costing
(period-based accrual calculation and variance calculation). The results of period end closing
with the cost objects are settled to Financial Accounting (FI) and CO-PA.
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Figure 110: Product Cost Controlling – Components (2)
Unit 8: Cost Object Controlling
Product Cost Controlling – Components (3)
Figure 111: Product Cost Controlling – Components (3)
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Cost Object Controlling helps you answer the following questions:
308
●
What actual costs did you incur in your area during the current period?
●
What costs did you expect based on the quantity manufactured?
●
Are some product groups performing significantly better than others?
●
What is causing these variances?
●
What are the scrap costs of your new production line?
●
Did continuous improvements have an effect on the costs?
●
What kind of profit is brought about by a concrete sales order?
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Actual costing is used to calculate the actual cost of goods manufactured at the end of the
period. The result can be saved in the material master as a periodic average price for the
closed period. The quantity structure is derived dynamically from the material movements in
the SAP S/4 HANA application. The values connected with these movements are collected in
the material ledger. With multilevel settlement, you allocate variances over multiple
procurement levels.
Lesson: Outline Cost Object Controlling
Cost Object Controlling
Figure 112: Preliminary Costing – Calculations
Product costing valuates the quantity structure of the BOM with the following information:
●
Material costs
●
Production costs
●
Process costs
●
Overhead on the direct material and production costs
●
Overhead for sales and administration costs
The system saves the results as a cost component split and an itemization. These results are
used as follows:
●
●
●
The Cost Object Controlling (CO-OBJ) uses the itemization in variance analysis on
itemization level.
The Profitability Analysis (CO-PA) uses the cost component split to calculate the
contribution margin.
The Financial Accounting (FI) uses the cost component split to split the cost of goods sold
(COGS).
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309
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Product costing uses the logistics data to determine the BOM and the activities required. This
data forms the quantity structure.
Unit 8: Cost Object Controlling
Simultaneous Costing – Working Process
Figure 113: Simultaneous Costing – Working Process
●
Goods movements in Materials Management (MM)
●
Invoice receipts in FI
●
Confirmations in PP
●
Account Assignment of external services directly purchased for the cost object
●
Settlement of costs for re-work
You can enter material withdrawals from the warehouse, confirmations, and goods receipts in
separate operations. You can use the control key of the operation to specify that a goods
receipt is to be posted automatically when the operation is confirmed (normally the last
operation). You can also assign consumable materials to an operation and specify that a
goods issue for these materials can be automatically posted with the confirmation. You can
create the confirmation at order or operation level. Confirmation at operation level is
recommended if WIP and variances are to be calculated later.
310
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The actual costs of the cost object result from the following processes, for example:
Lesson: Outline Cost Object Controlling
Period-End Closing – Working Process
Template allocation is an allocation technique for activities and processes in Management
Accounting. The sender could be cost centers or business processes, the receiver might be
any controlling object type. Essentially, it can use any information from the SAP S/4HANA
application as a cost driver to allocate overhead costs based on consumption. Regarding
revaluation, for cost center activities an actual price calculation could be performed to
revaluate the activity allocation with these actual prices.
Overhead allocation is a traditional method of calculating the overhead costs of cost centers
on cost objects using surcharges on direct costs. Template allocation has extended
functionality due to the diversity of available drivers.
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Figure 114: Period-End Closing – Working Process
Unit 8: Cost Object Controlling
Execution of Period-End Closing
The system uses results analysis to determine the WIP based on either actual costs when full
settlement is used, or target costs when periodic settlement is used. Variance calculation
determines the target costs of the cost object. The target costs enable you to run a target/
actual comparison report. The scrap variance is calculated always based on the target costs
compared to actual costs.
The system performs a results analysis for cost objects that carries revenue. Those cost
objects are as follows:
●
Sales Order Items
●
Work Breakdown Structures
●
Internal Orders
●
Maintenance Orders
●
Customer Service Orders
To perform results analysis, the system needs the parameter Results Analysis Key in the cost
object to be assigned. Settlement is the last step of period-end closing in Cost Object
Controlling. The values determined are settled in other components, such as FI and CO-PA,
and at the same time, the system creates the appropriate line items in the Material Ledger.
312
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Figure 115: Execution of Period-End Closing
Lesson: Outline Cost Object Controlling
Product Cost by Order
Product Cost by Order is used when the focus of Controlling is on discrete quantities. The
prerequisite for that controlling method is the use of production orders in the production
planning area (PP). Production orders are used for products that experience variation, or
differ depending on customer requirements.
Production Order
Figure 117: Example – Production Order
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Figure 116: Product Cost by Order
Unit 8: Cost Object Controlling
Costs are captured for goods issues, confirmations and goods receipts. These costs are
posted to the cost object, such as a production order.
The settlement rule has the settlement type FUL, which means full settlement. For period-end
closing, the status of the cost object chooses whether WIP or variances could be calculated.
Figure 118: Relevance of Status in Product Cost by Order
In the Product Cost by Order component, the status of the cost object indicates whether the
system calculates WIP or variances.
Product Cost by Order has the following statuses:
●
●
●
314
If the order has neither the status delivered (DLV) nor technically completed (TECO), WIP
is calculated based on actual costs. The difference between all debits and credits of the
order is the value of the WIP.
If the order has status DLV or TECO, any existing WIP will be canceled and the system
interprets the entire remaining order balance as variances. Various variance causes are
evaluated and summarized into appropriate variance categories.
Product Cost by Order does not realize variances until the last period of production.
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Relevance of Status in Product Cost by Order
Lesson: Outline Cost Object Controlling
Product Cost by Period
Product Cost by Period is used when the focus of Controlling is on a consistent and
continuous production process with a standard product. The use of the Product Cost
Collector is recommended when the logistics processes are stable and do not require order
level control. The use of a Product Cost Collector is necessary in the following cases:
●
●
You are using repetitive manufacturing with production process which means that
production planning and confirmation will be performed to the production line and not by
production orders. All costs depending on the logistic processes to the production line are
posted to the Product Cost Collector.
You are using the Process Orders within Joint-Production. Using Joint-Production, Product
Cost by Period is not available.
Using the Product Cost Collector, the controlling level is based on the product-ID.
Manufacturing within mass production, the controlling level related to products and not every
production order usually makes more sense. The production line on which a product is
manufactured is represented by a production version in the material master of the product.
The production version combines the material number of the product with the production line
(routing-number) and the used primary products, such as raw material.
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Figure 119: Product Cost by Period
Unit 8: Cost Object Controlling
Product Cost Collector
Figure 120: Example – Product Cost Collector
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Periodicity in Product Cost by Period
Figure 121: Periodicity in Product Cost by Period
In Product Cost by Period, WIP is calculated in target costs and variances simultaneously in
the following ways:
316
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Costs for goods issues, confirmations, and goods receipts are posted to the cost object, such
as product cost collectors. The settlement rule has the settlement type PER. For period-end
closing, the system calculates WIP in target costs and variances simultaneously.
Lesson: Outline Cost Object Controlling
●
●
●
●
For repetitive manufacturing, you need to define reporting points to obtain return values
for operations. For production and process orders controlled by period, you must enter
confirmations for the operations. SAP recommends a product cost collector as the cost
object for repetitive manufacturing.
The system determines the target costs of the cost object based on the costing that you
can specify with a valuation variant in Customizing. Based on this, the system calculates
the WIP and the scraps at target cost.
Variances result from deducting the WIP and the scrap at target cost from the balance,
where various variance causes are examined and represented by appropriate variance
categories.
Variances are realized by period in Product Cost by Period.
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Unit 8: Cost Object Controlling
Facilitator
Producer
Say:
-
-
"We're going to break into groups of 3
people to discuss and complete the following activity".
Do:
-
-
"You will have 15 minutes to work together in the breakout rooms and then we'll
meet together in the main classroom".
-
Do:
-
-
-
-
318
-
Assist the instructor by moving between
the various breakout rooms and answering questions regarding the technology
and questions to be discussed.
If desired, archive the individual breakout
room chat and whiteboard pods for immediate discussion in the main classroom and for later reference or distribution.
Broadcast announcements to everyone.
For example, give a two-minute warning
prior to the end of the breakouts.
Describe how to use the audio sub-conferences and refer to this content in the
Participant Handbook.
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-
Collect the required demographic information, such as job role, prior experience
with the application, and so on, in order
to assign participants to groups.
Assign participants to breakout rooms.
Advise participants about how to contact
the instructor while in the breakout
rooms (that is, private chat and instant
messaging).
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
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Lesson: Outline Cost Object Controlling
INTERACTIVE ELEMENT: Breakout Rooms
1. Create an organizational structure in your enterprise. List the jobs and positions in a
specific organizational unit of your enterprise. Discuss the different statuses of Product
Cost by Period.
.
.
.
.
.
.
.
.
.
.
Product Cost by Order Versus by Period
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Figure 122: Product Cost by Order Versus by Period
Some cost objects can only be controlled by order, and others can only be controlled by
period. There are order-related cost objects that can be switched to cost by period in
Customizing.
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Unit 8: Cost Object Controlling
Controlling in Make-to-Order Scenarios
Some cost objects can only be controlled by order, while others can be controlled by period.
When using repetitive manufacturing without production orders in PP, a product cost
collector is required for cost object controlling. In this production scenario, a simplified status
concept is applied. The standard products will be manufactured over months and years,
therefore a status-relevant period-end closing, like in product cost by order, could not be
used.
Figure 123: Cost by Sales Order and Customer Project
Customer order processing is used when the production starts after the customer order has
been received. This scenario takes place in the following situations:
●
Individual constructions have been ordered by the customer
●
Series products with variant configuration will be manufactured
●
In general with plant construction
The customer order can provide the functionality to represent the order-to-cash process. The
customer order can be combined with other cost objects such as WBS and Internal Orders.
When using the Project System (PS), a sub-project as part of a project structure (WBS —
Work Breakdown Structure) can be assigned to the customer order item. If the WBS is marked
with the operational indicator Billing element, the revenues are posted to the WBS within the
billing of the sales order item. This allows several customer orders to be combined into one
project, or to different sub-projects of a WBS. If a WBS is marked as statistical, it cannot be
assigned to the sales order.
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While production orders in the manufacturing scenario use actual cost to calculate work in
process (WIP), revenue-bearing cost objects are not used directly in the production scenario
but in order-to-cash scenarios. Cost objects in such scenarios are sales order items, work
breakdown structures (WBS) and customer service orders.
Lesson: Outline Cost Object Controlling
Scenario with Several Controlling Concepts
If a customer order is added to order-specific product controlling or periodic controlling, the
work with the objects that represent the production does not necessarily change. By means of
Customizing, it is possible that the customer order is processed with the Product Cost by
Sales Order, whereby the result analysis for this revenue-bearing cost carrier is performed.
Sub-products, especially those with the flag Collective Requirements Only and the production
scenario Repetitive Manufacturing, will be controlled with the controlling concept Product
Cost by Period. Sub-products with the requirement type “Individual Requirements Only” or
requirement type “_” (blank) deriving upper level make-to-order requirements will be
controlled with Product Cost by Order.
While the period-end closing in Product Cost by Period and Product Cost by Order focus on
work in process (WIP) and variance analysis, the Product Cost by Sales Order calculates the
reserves for anticipated losses or missing actual costs.
FACILITATED DISCUSSION
Describe the components of CO-PC and their main tasks. Explain the differences between
Product Cost by Period, Product Cost by Order and Product Cost by Sales Order.
Products Used in this Course
In this course, a forklift will be used for the following scenarios:
●
Make to stock production (MTS) with product cost by period
●
Make to stock production with product cost by order
●
Make to order production (MTO) with product cost by sales order
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Figure 124: Combined Controlling Scenarios
Unit 8: Cost Object Controlling
Using the Product Cost by Period scenario, a product cost collector will be created using the
bill of materials (BOM) and the routing of the assembly Gearbox. The connection between the
product cost collector and the production order is based on the Controlling Level, which in this
case is the BOM and the routing. Alternative controlling levels are product versions, which
includes the BOM and routing, or just the plant. The product version as controlling level will be
used in the production scenario with Repetitive Production. Using the plant as controlling
level, a fully production controlling is not available. Such a controlling level is not used in this
course. To enable such a scenario, the product cost collector first has to be created. The
order type for the production orders needs a flag to be assigned to the product cost collector
and the settlement type PP2 (production material periodic settlement). Although the
production order will not save any costs, the settlement rule in the production order is used to
credit the product cost collector with the yield quantity confirmed to the production order.
Without settlement type Periodic Settlement, the assignment of the flag Product Cost
Collector to the order type of the production order is not possible.
The Product Cost by Order scenario will be used with the assembly chassis of the forklift. In
this coupling scenario, the production order is used as a logistic order and cost object
simultaneously. The main difference between Product Cost by Period and Product Cost by
Order is the calculation of the work in process (WIP). Using product cost by order, the WIP is
calculated on the actual cost balance of the production order. It is dependent on the status of
the production order. Only production orders which are not technically completed, or final
confirmed, calculate the actual balance as WIP. Otherwise, the actual balance is a variance
and WIP is zero. Using Product Cost by Period, the WIP and variances are calculated at any
period-end closing. Therefore, the WIP is not calculated based on actual cost, but on target
cost. The target costs are the multiplication of the actual WIP quantity and the standard cost,
based on the material cost estimate or preliminary costing of the product cost collector. The
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Figure 125: Forklift
Lesson: Outline Cost Object Controlling
difference between the actual balance and the WIP is the variance of the product cost
collector in the period end closing for every period.
In the Product Cost by Sales Order scenario, a sales order for the forklift will be created. The
sales order item needs a requirement type for MTO - production. The requirement class in
this scenario includes the flag to post the yield quantity with the Stock Type Sales Order
Stock. It also includes an account type (E) which sets the sales order item as a controlling
object. The material requirement run in production planning (PP) will create a plan order,
which is assigned to the sales order item. With the conversion of the plan order to the
production order, the production order will also be assigned to the sales order item.
Therefore, the confirmed yield quantity will be posted with stock type sales order stock. Using
the information system, the cost can be analyzed from the view of the sales order item to all
assigned production orders.
LESSON SUMMARY
You should now be able to:
●
Outline cost object controlling
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323
Unit 8: Cost Object Controlling
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Unit 8
289
Learning Assessment
1. When the production scenario is defined with Repetitive Manufacturing, which Cost Object
could be used to calculate the variances of the production line?
Choose the correct answer.
X
A Product Cost Collector
X
B Work Breakdown Structure
2. If the order has neither status delivered nor status technically completed, work in process
(WIP) is calculated based on which of the following?
X
A Actual cost
X
B Target cost
X
C Plan cost
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Choose the correct answer.
325
Unit 8
290
Learning Assessment - Answers
1. When the production scenario is defined with Repetitive Manufacturing, which Cost Object
could be used to calculate the variances of the production line?
Choose the correct answer.
X
A Product Cost Collector
X
B Work Breakdown Structure
Correct. The product cost collector is the correct object.
2. If the order has neither status delivered nor status technically completed, work in process
(WIP) is calculated based on which of the following?
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X
A Actual cost
X
B Target cost
X
C Plan cost
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Choose the correct answer.
Correct. Actual cost is used.
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UNIT 9
Product Cost Controlling by
Period
Lesson 1
Using a Product Cost Collector
Exercise 15: Create a Product Cost Collector
328
337
Lesson 2
Using a Production Order and Product Cost Collector
Exercise 16: Create a Production Order
347
353
Lesson 3
364
373
Lesson 4
Performing Simultaneous Costing for Product Cost Collector
Exercise 18: Post Goods Issue and Confirmation to the Production Order
Exercise 19: Post Goods Receipts to a Production Order
380
385
395
UNIT OBJECTIVES
●
Create a product cost collector
●
Configure the order type for a product cost collector
●
Create a production order
●
Perform preliminary costing
●
Debit the product cost collector with actual costs
●
Credit the product cost collector with actual costs
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Performing Preliminary Costing for Product Cost Collector
Exercise 17: Perform Preliminary Costing
Unit 9
Lesson 1
292
Using a Product Cost Collector
LESSON OVERVIEW
This lesson explains how to create a product cost collector and use it to determine the cost of
products by period.
Before beginning this lesson, check in Customizing that the main planning strategy for
strategy group PP has the value 10. To do so in Customizing, choose Controlling → Product
Cost Controlling → Cost Object Controlling → Product Cost by Sales Order → Control of
Sales-Order-Related Production/Product Cost by Sales Order → Selection of Requirements
Type Through MRP Group → Check Strategy Groups. Choose the entry PP. The main
planning strategy must have the value 10.
Your company produces various types of pumps. You need to create a production order in the
master data according to the production volume. You have decided to use a product cost
controller as the cost object. For this reason, you require the following knowledge:
●
An understanding of how to create the master data for a production order and a product
cost collector
LESSON OBJECTIVES
After completing this lesson, you will be able to:
328
●
Create a product cost collector
●
Configure the order type for a product cost collector
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Business Example
Lesson: Using a Product Cost Collector
Figure 126: Periodicity of Product Cost Collectors
To determine the costs of a product by period with the Product Cost by Period concept, you
need a cost object with settlement type Periodic Settlement. The product cost collector
assumes the function of the cost object. If you use a product cost collector, logistical
production objects (such as production orders) are not used as cost objects.
Posting in Materials Management (MM), Production Planning (PP), and Financial Accounting
(FI) results in actual costs, which will be debited to the product cost collector and not to the
production orders. You post confirmations, goods issues, and goods receipts with reference
to the production order. You configure the orders to assign these costs to the product cost
collector automatically. You can assign other costs, such as process costs or material
overhead, directly to the product cost collector. You perform all the period closing activities
using the product cost collector.
Periodic actual costs from the cost object can be grouped as follows:
●
●
Costs for products for which a goods receipt in the warehouse is listed in the current
period (delivery to stock)
Costs for work in process (WIP):
These are target costs for the production quantities that have been confirmed for the
operations but not yet delivered to stock. Target cost means that the actual WIP quantity
will be multiplied by the standard cost of the material cost estimate, or the preliminary
costing of the product cost collector.
●
Production variances that you calculate using the following formula:
Variances = actual debit - goods receipt - WIP
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Product Cost Collector
Unit 9: Product Cost Controlling by Period
Uses of the Product Cost Collector
Figure 127: Uses of the Product Cost Collector
You can collect actual costs on the product cost collector for the following types:
●
Order-related production (that is, when you use production orders)
●
Process manufacturing (that is, when you use production with process orders)
●
●
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Repetitive manufacturing for which the cost object is always used as a product cost
collector (this also applies to KANBAN production methods)
Mass production based on sales orders when you use valuated sales order stock, and in
repetitive manufacturing when you produce individual requirements materials
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Product cost collectors are created independently of the production type.
Lesson: Using a Product Cost Collector
Facilitator
Producer
Say:
-
"You're going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I'll give you 5 minutes to work with your
partner and then we'll summarize briefly
as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
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Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
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331
Unit 9: Product Cost Controlling by Period
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
What are the uses of the product cost collector?
Using private chat, take 5 minutes to discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
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.
Production Order and Product Cost Collector – Process Chain
Figure 128: Production Order and Product Cost Collector – Process Chain
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Lesson: Using a Product Cost Collector
In the Product Cost by Period scenario, the product cost collector collects and analyzes the
costs. Production orders do not serve as cost objects. They are used for logistical processing
only. You can calculate the plan cost of the production order for analyzing issues, but you
cannot save the plan costs.
To ensure that the system collects costs of a manufacturing order on a product cost collector,
you must make the necessary settings for the order type of the manufacturing order in
Customizing for Product Cost by Order under Define Default Values for Order Type.
You must create a product cost collector manually before you start production. When you
create a manufacturing order, the system links the manufacturing order to the product cost
collector automatically.
If you do not create a product cost collector, the manufacturing order collects the costs. In
such a case, it is only possible to link the manufacturing order to the product cost collector
when no actual costs have been updated to the manufacturing order.
Note:
This course often uses the term manufacturing order. This is an umbrella term for
production order and process order.
Production Process
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Figure 129: Automatic Assignment of Orders to Product Cost Collectors
The production process assigns the production order to the product cost collector. The
system generates the production process automatically when you create the product cost
collector.
The system links product cost collectors to the production orders and to the production
versions in repetitive manufacturing, in the same way. The production orders linked to
product cost collectors also have the status PCC (Product Cost Collector).
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333
Unit 9: Product Cost Controlling by Period
Controlling Levels
When you create the product cost collector, you can decide the level for costs collection.
Every production process has unique characteristics. You specify which characteristics are
updated for the production process by means of the controlling level.
The controlling level is defined with the following:
●
Plant, material number and production version.
The production version includes BOM number, routing number, and valid lot size.. In
repetitive manufacturing, the production planning and confirmation is executed to
production version. Therefore, a product cost collector has to be created for each
production version.
●
Plant, material number, BOM and routing.
This controlling level is standard in every manufacturing scenario except repetitive
manufacturing.
●
Plant and material number.
This controlling level does not take into account the specific characteristics of BOM and
routing, and therefore does not enable a completely production controlling. It is a
summarized controlling on a higher level of analysis.
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Figure 130: Controlling Levels
Lesson: Using a Product Cost Collector
Figure 131: Product Cost Collector and the Production Process
The Controlling levels are used as follows:
●
Production version:
If you are using the Production version controlling level, the system creates a product cost
collector for the characteristics material, production plant, planning plant, and production
version. SAP recommends this controlling level when you are using production versions in
repetitive manufacturing.
●
BOM and routing combination:
If you are using the BOM/routing controlling level, the system creates a product cost
collector for the characteristics material, production plant, planning plant, BOM, and
routing. Use the BOM/routing controlling level only if the material does not have any
production versions. The BOM usage and the alternative BOM identify the BOM. The task
list type and the task list group identify the routing.
●
Material per plant:
If you are using the Production Plant/Planning Plant controlling level, the system creates
product cost collector for the characteristics material, production plant, and planning
plant. These product cost collectors have a number of features. For example, it is not
possible to create a preliminary cost estimate for a product cost collector. This affects
subsequent functions. If you make changes to the reporting points of the production
versions, errors may arise.
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Product Cost Collector and Production Process
Unit 9: Product Cost Controlling by Period
How to Create a Product Cost Collector
Demonstrate the steps listed in the Create a Product Cost Collector exercise.
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336
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Unit 9
Exercise 15
299
Create a Product Cost Collector
Business Example
You are a member of the Controlling department and have decided to use a product cost
collector as a cost object. In the production area, production orders are used. However, while
the gearbox is used in different types of forklifts as a standard assembly (COMMON PART),
the controlling level PRODUCT will be used and not the production order. To meet this
requirement, you create a product cost collector for the GEARBOX (T-FL2##) and analyze
the cost data of the cost collector. You also need to create a production order and review the
control data transferred from the product cost collector to the production order. Although
you have completed all of the Customizing activities, you still need to verify the settings for
the order types and the costing variants relevant for the Product Cost by Period scenario.
Create a product cost collector.
Note:
In this exercise, ## is used as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Create a product cost collector for gearbox assembly T-FL2## in plant 1010. The order
type is RM01. The product cost collector must be valid for a BOM and routing. When you
create the cost collector, enter BOM usage 1, alternative 01, and search for a valid routing
for material T-FL2## in plant 1010. Enter the value 10 in the field Costing Lot Size. Save
the product cost collector. Choose Yes when asked if you want to create a preliminary cost
estimate for the product cost collector. Stay on this app for the next step in this exercise.
2. Use the app Maintain Product Cost Collectors to display the product cost collector and its
parameters. Enter the material number T-FL2## and plant 1010. Choose the Display/
Change button. What parameters have been assigned to the product cost collector for the
following?
Costing sheet:
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To manage Cost Object Controlling for gearbox assembly T-FL##, you have to create a
product cost collector. The controlling level for the gearbox will be the Bill of Materials (BOM)
and the routing combination level.
Unit 9: Product Cost Controlling by Period
Overhead key:
Results Analysis key:
Variance key:
Order number:
Production Process number:
3. Verify the Costing Variant for planned costs and the Costing Variant for actual costs. A
different costing variant is specified for the planned costs than for the actual costs. Why is
this necessary?
Planned Costs Costing Variant:
Actual Costs Costing Variant:
338
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Order Type:
Unit 9
Solution 15
301
Create a Product Cost Collector
Business Example
You are a member of the Controlling department and have decided to use a product cost
collector as a cost object. In the production area, production orders are used. However, while
the gearbox is used in different types of forklifts as a standard assembly (COMMON PART),
the controlling level PRODUCT will be used and not the production order. To meet this
requirement, you create a product cost collector for the GEARBOX (T-FL2##) and analyze
the cost data of the cost collector. You also need to create a production order and review the
control data transferred from the product cost collector to the production order. Although
you have completed all of the Customizing activities, you still need to verify the settings for
the order types and the costing variants relevant for the Product Cost by Period scenario.
Create a product cost collector.
Note:
In this exercise, ## is used as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Create a product cost collector for gearbox assembly T-FL2## in plant 1010. The order
type is RM01. The product cost collector must be valid for a BOM and routing. When you
create the cost collector, enter BOM usage 1, alternative 01, and search for a valid routing
for material T-FL2## in plant 1010. Enter the value 10 in the field Costing Lot Size. Save
the product cost collector. Choose Yes when asked if you want to create a preliminary cost
estimate for the product cost collector. Stay on this app for the next step in this exercise.
a) On the SAP Fiori Launchpad screen, select the app Maintain Product Cost Collectors in
the tile group Controlling — Product Cost by Period.
b) In the Display Product Cost Collector selection screen, enter the following data:
Field Name
Value
Material
T-FL2##
Plant
1010
Choose Create Product Cost Collector.
c) On the Create Product Cost Collector dialog box, enter the following data:
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To manage Cost Object Controlling for gearbox assembly T-FL##, you have to create a
product cost collector. The controlling level for the gearbox will be the Bill of Materials (BOM)
and the routing combination level.
Unit 9: Product Cost Controlling by Period
Field Name
Value
Order Type
RM01
Controlling Level for Material
Select the icon BOM/routing .
Planning Plant
1010 (automatically filled from the previous selection)
BOM usage
1
Alternative BOM
1
Task List Type
Select Routing
Group
Choose the Entry Help and select Search
using material. Choose the FIND button.
The system will find exactly one routing.
Choose the COPY icon.
Choose Confirm.
d) In the Production Process tab, enter for the Costing Lot Size the value 10.
e) Choose the icon Save.
Note:
You don’t need to notify the order number of your product cost collector,
because you can select the product cost collector just with your material
number and with plant.
g) Stay on this app for the next step in this exercise.
2. Use the app Maintain Product Cost Collectors to display the product cost collector and its
parameters. Enter the material number T-FL2## and plant 1010. Choose the Display/
Change button. What parameters have been assigned to the product cost collector for the
following?
Costing sheet:
Overhead key:
340
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f) On the Create Product Cost Collector dialog box, the system asks you whether to
create a preliminary cost estimate. Confirm by choosing the Yes button.
Lesson: Using a Product Cost Collector
Results Analysis key:
Variance key:
Order Type:
Order number:
a) Select the app Maintain Product Cost Collector in the tile group Controlling — Product
Cost by Period. Choose material T-FL2## and plant 1010.
b) In the Product Cost Collectors column on the left, mark the node with you material
number T-FL2## to select your product cost collector.
c) Choose Display/Change.
d) On the Product Cost Collectors for Selection area of the screen, select the product cost
collector that you created in the previous step. The following information appears in
the relevant fields:
Tab Data
Field
Value
Costing Sheet
1010PC
Overhead Key
ZMT00
Results Analysis Key
MBMF03 (WIP on Target Costs)
Variance Key
000001
Tab Header
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Production Process number:
Unit 9: Product Cost Controlling by Period
Field
Value
Order Type
RM01
Order Number
7.....
Tab Production Process
Field
Value
Production Process No.
1........
3. Verify the Costing Variant for planned costs and the Costing Variant for actual costs. A
different costing variant is specified for the planned costs than for the actual costs. Why is
this necessary?
Planned Costs Costing Variant:
a) On the Data tab page, make sure that the following costing variants are displayed:
Field
Values
Planned Costs Costing Variant
PYRM
Actual Costs Costing Variant
PSRM
Note:
The costing variant for planned costs PYRM refers to the costing type 19 Product Cost Collector. The costing variant for actual costs PSRM refers to
the costing type 07 - Production Order Actual. Therefore, two different
costing variants are needed for each cost object. The assigned costing type
initiates an update of the results of either the preliminary cost estimate or
the actual costs of the product cost collector. In addition, you can choose
different materials and activity prices for preliminary costing and
simultaneous costing. You can also choose different valuations for external
procurement and external activities. The transactions in the SAP Easy
Access menu to customize the costing variants are OKKN - Costing
Variants to Determine Activity Quantities for planned costs and OPL1 Costing Variants for Valuation of Internal Activities for actual costs.
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Actual Costs Costing Variant:
Lesson: Using a Product Cost Collector
Note:
The costing variant is provided in the field description Planned Costs
Costing Variant. No planned costs are calculated in Product Cost by Period.
No planned production quantity is assigned to the product cost collector,
only a Costing Lot Size. When reporting the cost of the product cost
collector, only actual and target costs are calculated.
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343
Unit 9: Product Cost Controlling by Period
Configuration of Order Type for a Product Cost Collector
Figure 132: Product Cost Collector – Default Values for the Order Type
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This default rule is linked to settlement type PER (periodic). As a result, the settlement rule for
the product cost collector is also assigned to settlement type PER. The default rule STR also
ensures that the values can be settled from a product cost collector.
This is necessary, for example, when the product cost collector collects the costs of materials
that have been assigned to different valuation types (such as special batch inventories), or
that are part of a valuated sales order stock.
When the product cost collector is settled, the system apportions the balance between the
different stock in accordance with the delivery values for the relevant period. The settlement
process generates the distribution rule automatically, based on the delivery values. The
system creates equivalence numbers based on the delivery values, and transfers these
equivalence numbers into the dynamic distribution rule.
A results analysis key must be specified in all product cost collectors for which you want to
calculate WIP.
For preliminary costing and simultaneous costing, enter the costing variant and the valuation
variant in the order type. This defines the valuation procedure for materials, internal activities,
external activities, and business processes. It also determines the overhead structure to
calculate overheads.
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A product cost collector is an order. The order type of a product cost collector must belong to
order category 05 (product cost collector). In the table Cost-Accounting-Relevant Default
Values for Order Types and Plants, the default rule STR (strategy for tracing factor
determination) is specified for the product cost collectors.
Lesson: Using a Product Cost Collector
How to Configure the Order Type for a Product Cost Collector
Go to the Customizing and explain the order type RM01. RM stands for Repetitive
Manufacturing. Make it clear that in earlier times (SAP R/4 Rel. 4.0), the product cost
collector was only available to repetitive manufacturing. The ability of the product cost
collector has been delivered with release 4.5l in SAP R/3. Using repetitive manufacturing, a
product cost collector is mandatory, because no production order can be used as cost object.
Using discrete manufacturing, the objective of the product cost collector is to summarize the
costs for each product number.
The product cost collector does not use plan cost, only actual and target costs. The reason is
the possible usage for repetitive in manufacturing, where a plan production quantity might
not be exactly defined, for which planned costs can be calculated.
Make it clear that only the settlement type Periodic Settlement can be used. The reason is the
assignment of several production orders, which might have different statuses, such as
created, partial released, released, partial confirmed, and confirmed. Because of this, the
status concept in settlement type Full Settlement cannot be used.
Make it clear that in Customizing of the product cost by period, the calculation of WIP and
target costs could be assigned to the preliminary costing of the product cost collector and
also to the material cost estimate.
b) On the Change View “Default Values for Order Cost Estimate”: Overview screen, choose
plant 1010 and order type RM01.
c) Choose the Details buton. The costing variant for simultaneous costing is PSRM.
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1. a) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Order → Manufacturing Orders → Define CostAccounting Relevant Default Values for Order Types and Plants.
Unit 9: Product Cost Controlling by Period
LESSON SUMMARY
You should now be able to:
●
Create a product cost collector
●
Configure the order type for a product cost collector
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346
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Unit 9
Lesson 2
308
Using a Production Order and Product Cost
Collector
LESSON OVERVIEW
This lesson explains how to create a product cost collector using a production order.
Business Example
In this example, we will take a closer look at production for production orders. You will create
a production order in the master data and use a product cost collector as a cost object for
controlling by period.
For this reason, you require the following knowledge:
●
An understanding of how to create a product cost collector using a production order
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Create a production order
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347
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A manufacturer produces various types of pump using the make-to-stock (MTS) production
method. Sales controlling is only carried out in Profitability Analysis (CO-PA). The popular
types of gearboxes are produced in a continuous production process and mapped in the
system with repetitive manufacturing. A less popular gearbox type is to be produced solely on
the basis of the lot size with production orders and only when the stock in the warehouse
drops below the reorder point. To be able to compare the cost objects more effectively, all the
production processes must be accompanied by controlling by period. Each gearbox has a
production version for repetitive manufacturing and another production version for orderrelated production.
Unit 9: Product Cost Controlling by Period
Production Order
When you assign a production order to a product cost collector, the status Product Cost
Collector Used (PCC) will be assigned to the production order. A preliminary cost estimate
can be generated for the production order, but the results cannot be saved to the production
order as planned values. This function is only available to simulate the plan costs for the
specific production order.
348
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Figure 133: Production Order and Production Process
Lesson: Using a Production Order and Product Cost Collector
Figure 134: Customizing – Production Order
You must specify default rule Periodic (PP2) for the order type of the production order. The
costing variant and the valuation variant specified in the order type for the production order
are used for the preliminary cost estimate. This cost estimate is for information purposes
only. If you do not want the system to create this cost estimate, you do not need to enter the
costing variant or the valuation variant. No results analysis key is specified in the order type,
because work in process (WIP) is calculated for the product cost collector based on target
cost.
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349
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Duplication is prohibited.
Customizing – Production Order
Unit 9: Product Cost Controlling by Period
Facilitator
Producer
Say:
-
"You're going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I'll give you 5 minutes to work with your
partner and then we'll summarize briefly
as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
350
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
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Lesson: Using a Production Order and Product Cost Collector
INTERACTIVE ELEMENT: Chat
1. With your partner, answer the following question:
Explain the function of default rule PP2.
Using private chat, take 5 minutes to discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
Duplication is prohibited.
Duplication is prohibited.
.
How to Create a Production Order
Demonstrate the steps listed in the Create a Production Order exercise.
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351
Unit 9: Product Cost Controlling by Period
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Duplication is prohibited.
352
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Unit 9
Exercise 16
313
Create a Production Order
Business Example
The colleagues in the production logistic are working with production orders. The controlling
department does not use the production order as a cost object but as a product cost
collector. To enable the assignment of the production orders to the product cost collector, the
product cost collector must be created. This has been done in the previous exercise. Using
the product cost collector includes using the concept of Product Cost by Period.
Therefore, you create a production order with an order type, that controls the assignment of
the production order to the already defined product cost collector. Although you have
completed all of the Customizing activities, you need to verify the settings for the order types
(Product Cost Collector and Production Order).
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor assigned to you.
Task 1: Post Goods Receipt for the Materials of Gearbox T-FL2##
To prevent a deficit of material stock, a goods receipt needs to be posted. Additionally, if
automatic release is used, missing stock availability will stop the release of the production
order.
1. In the app Post Goods Movement, in the tile group Production Planning & Material
Management, post a goods receipt for the raw materials T-FL2A## and T-FL2B## into
plant 1010 and storage location 101B. Post a quantity of 100 for each material number.
Task 2: Create a Production Order
In the tile group Production Planning & Material Management use the app Create Production
Order to create a production order assigned to your product cost collector.
1. Create a production and use the data defined in the following table:
Field Name
Value
Order Type
PP08
Material Number
T-FL2##
Plant
1010
Quantity
10
Dates/Times START
Current date
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353
Duplication is prohibited.
Duplication is prohibited.
Create a production order.
Unit 9: Product Cost Controlling by Period
Field Name
Value
Scheduling Type
Forwards
Note the production order number: ___________________________
2. Check the control data for the production order.
How were the costing variants and the costing sheet determined for the production order?
Can they be changed for the production order? Does this effect the cost object?
3. Check the status and material availability of the production order.
4. On the Control tab page, locate the production process.
5. On the Assignment tab page, determine which profit center has been assigned to the
production order.
Which master record determined the profit center?
6. In the Production Order Change - Header data, select the icon Operations and review the
operations that have been selected for this production order.
Which work center is assigned to operation 0010? What is the control key for this
operation?
354
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Duplication is prohibited.
Duplication is prohibited.
Is this production process unique for the BOM and routing or is it valid for T-FL2## in
plant 1010?
Lesson: Using a Production Order and Product Cost Collector
Note:
The control key determines the following parameters, among other things:
●
Automatic Goods Receipt (referring to the confirmed yield quantity)
●
Cost (relevant for costing)
●
Milestone confirmation (leads to automatic confirmation of all previous
operations, which are no milestone operations with target values
(quantities and time))
To post an automatic goods receipt when confirming the last operation of a
production order, this operation needs a control key with the indicator
Automatic Goods Receipt.
7. Review the material components and verify the required quantity for each component.
8. Release the production order.
You receive the message Release carried out.
9. Save the production order and note the order number:
Task 3: Display the Characteristics of the Order Type
Display the characteristics of the order type of the production order assigned to a product
cost collector.
1. How a product cost collector is used depends on the order type selected for the
production order. Display the order type defaults for plant 1010 and order type PP08.
Review the Customizing settings. Use the SAP Easy Access Menu.
2. Check the indicator for product cost collector.
Is the Product Cost Collector indicator selected?
3. Check the default rule for CO settlement.
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355
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Duplication is prohibited.
What are the required quantities of components T-FL2A## and T-FL2B##? Is there any
planned scrap for these components?
Unit 9: Product Cost Controlling by Period
What is the default rule for CO settlement?
4. Check the Results Analysis Key RA Key and the costing variant for order type PP08.
If a product cost collector is found for a material, with RA key and costing variant for the
production order type PP08, will this RA key and costing variant be used for the period-end
closing?
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Duplication is prohibited.
356
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Unit 9
Solution 16
317
Create a Production Order
Business Example
The colleagues in the production logistic are working with production orders. The controlling
department does not use the production order as a cost object but as a product cost
collector. To enable the assignment of the production orders to the product cost collector, the
product cost collector must be created. This has been done in the previous exercise. Using
the product cost collector includes using the concept of Product Cost by Period.
Therefore, you create a production order with an order type, that controls the assignment of
the production order to the already defined product cost collector. Although you have
completed all of the Customizing activities, you need to verify the settings for the order types
(Product Cost Collector and Production Order).
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor assigned to you.
Task 1: Post Goods Receipt for the Materials of Gearbox T-FL2##
To prevent a deficit of material stock, a goods receipt needs to be posted. Additionally, if
automatic release is used, missing stock availability will stop the release of the production
order.
1. In the app Post Goods Movement, in the tile group Production Planning & Material
Management, post a goods receipt for the raw materials T-FL2A## and T-FL2B## into
plant 1010 and storage location 101B. Post a quantity of 100 for each material number.
a) In the Fiori launchpad select the app Post Goods Movement in the tile group Production
Planning & Material Management
b) On the Goods Movement screen, enter the following data:
Field Name
Value
Transaction/Event
Select: Goods Receipt
Reference Document
Select: Other
In the Overview Area, 1. row
Material Number (named with material
description)
T-FL2A##
Quantity
100
Plant
1010
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357
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Duplication is prohibited.
Create a production order.
Unit 9: Product Cost Controlling by Period
Field Name
Value
Storage Location
101A
In the OVERVIEW area for 2. row:
Material Number
T-FL2B##
Quantity
100
Plant
1010
Storage Location
101A
Select the Post button to post the goods receipt.
Task 2: Create a Production Order
In the tile group Production Planning & Material Management use the app Create Production
Order to create a production order assigned to your product cost collector.
Field Name
Value
Order Type
PP08
Material Number
T-FL2##
Plant
1010
Quantity
10
Dates/Times START
Current date
Scheduling Type
Forwards
Note the production order number: ___________________________
a) On the SAP Fiori Launch Pad, select the app Create Production Order in the tile group
Production Planning & Material Management.
b) On the Production Order Create: Initial screen, enter the following data:
Field Name
Value
Material
T-FL2##
Production Plant
1010
Order Type
PP08
c) Choose Continue.
d) On the Production order Create: Header screen, enter 10 in the Total Qty field.
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Duplication is prohibited.
1. Create a production and use the data defined in the following table:
Lesson: Using a Production Order and Product Cost Collector
e) In the Dates/Times section, in the Start field, enter the current date.
f) In the Scheduling Type section, choose Forwards.
g) Choose Enter to carry out the scheduling.
Note:
If you receive a warning message that says the Document not valid
on explosion date, confirm the message by choosing Yes. Assigned
documents are probably not used in the cost object controlling scenario.
Note the number of your production order: ______________________
2. Check the control data for the production order.
On the Control tab page, the plan costing variant, actual costing variant, and costing sheet
were assigned to the production order by the product cost collector. If defined, the
overhead key could also be transferred from the product cost collector for the production
order. Only the costing variant for plan costs could be changed in the production order;
the costing variant for actual costs is just information about how the actual costs will be
updated to the product cost collector. You can calculate the planned costs for the
production order but you cannot save it. The production order in the scenario with product
cost collector is no cost object. In the period end closing, when performing the variance
analysis between planned costs of the cost object and the released material cost estimate,
the preliminary cost estimate of the product cost collector will be selected for comparison
with the released material cost estimate of each other material cost estimates. Only the
costing variant for Plan Costs could be changed, not the costing variant for Actual costs.
While the planned costs could be calculated for the production order, actual costs are not
posted to the production order. Actual costs are posted to the product cost collector.
a) In the tile group Production Planning & Material Management, select the Fiori app
Change Production Order.
b) Enter the number of your production order and choose Continue.
c) Choose the Control tab page.
3. Check the status and material availability of the production order.
a) On the Production Order Change - Header screen, on top of the screen, you see the
following status:
●
CRTD (Created)
●
MANC (Material availability not checked)
●
PCC (Product Cost Collector used)
b) Choose the icon Status Information to get an explanation for a status.
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359
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Duplication is prohibited.
How were the costing variants and the costing sheet determined for the production order?
Can they be changed for the production order? Does this effect the cost object?
Unit 9: Product Cost Controlling by Period
c) On the Production Order Change - Header screen, select More → Functions →
Availability Check → Material ATP . A message about confirmation of the available
materials should appear.
The required materials T-FL2A## (Clutch) and T-FL2B (Gear Wheel) should be
available. In this case, you should receive a message All checked materials in
order ####### are available.
4. On the Control tab page, locate the production process.
Is this production process unique for the BOM and routing or is it valid for T-FL2## in
plant 1010?
The production process is unique for this BOM and routing. This was determined when the
product cost collector was created.
a) Choose the Control tab page to find the production process, BOM, and routing.
5. On the Assignment tab page, determine which profit center has been assigned to the
production order.
Which master record determined the profit center?
a) Choose the Assignment tab page to view the profit center is displayed.
6. In the Production Order Change - Header data, select the icon Operations and review the
operations that have been selected for this production order.
Which work center is assigned to operation 0010? What is the control key for this
operation?
Work center T-R## is assigned to operation 0010. The control key is PP06.
Note:
The control key determines the following parameters, among other things:
●
Automatic Goods Receipt (referring to the confirmed yield quantity)
●
Cost (relevant for costing)
●
Milestone confirmation (leads to automatic confirmation of all previous
operations, which are no milestone operations with target values
(quantities and time))
To post an automatic goods receipt when confirming the last operation of a
production order, this operation needs a control key with the indicator
Automatic Goods Receipt.
a) Choose the Operation button.
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Duplication is prohibited.
Duplication is prohibited.
The profit center is maintained in the material master record for T-FL2##.
Lesson: Using a Production Order and Product Cost Collector
7. Review the material components and verify the required quantity for each component.
What are the required quantities of components T-FL2A## and T-FL2B##? Is there any
planned scrap for these components?
The required quantities for both components are 10 pieces. No scrap is planned for these
components.
a) In the Production Order Change: Operation Overview screen, choose the Components
button. (You can also select the Component Overview screen from the
Production order Change: Header screen.)
b) In the Production Order Change: Component Overview screen, verify the required
quantity of the components T-FL2A## and T-FL2B## are both 10 PC.
c) To check planned scrap, double-click the cell with the item number.
d) Scroll down to the field group Quantities and verify that there are no entries for
planned Operation Scrap and Component Scrap.
e) Go back to the Production Order Change: Component Overview screen.
8. Release the production order.
a) The function Release is available from each Production Order Change screen.
You receive the message Release carried out.
9. Save the production order and note the order number:
a) Save your data.
b) Note the order number.
Task 3: Display the Characteristics of the Order Type
Display the characteristics of the order type of the production order assigned to a product
cost collector.
1. How a product cost collector is used depends on the order type selected for the
production order. Display the order type defaults for plant 1010 and order type PP08.
Review the Customizing settings. Use the SAP Easy Access Menu.
a) In the SAP Easy Access Menu, choose transaction SPRO to navigate to Customizing. In
Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Order → Manufacturing Orders → Define CostAccounting Relevant Default Values for Order Types and Plants (transaction OKZ3).
b) On the Change View “Default Values for Order Cost Estimate”: Overview screen, choose
the row for plant 1010 and order type PP08.
c) Choose the Details button.
2. Check the indicator for product cost collector.
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361
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Duplication is prohibited.
b) In the app Production Order Change, select the function Release Order .
Unit 9: Product Cost Controlling by Period
Is the Product Cost Collector indicator selected?
The Product Cost Collector indicator is selected.
3. Check the default rule for CO settlement.
What is the default rule for CO settlement?
The default rule for CO settlement is PP2 periodic settlement.
4. Check the Results Analysis Key RA Key and the costing variant for order type PP08.
If a product cost collector is found for a material, with RA key and costing variant for the
production order type PP08, will this RA key and costing variant be used for the period-end
closing?
No, the RA key and costing variant for order type PP08 will not be used for the period-end
closing. The settings for the product cost collector will be used.
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362
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Lesson: Using a Production Order and Product Cost Collector
LESSON SUMMARY
You should now be able to:
●
Create a production order
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Duplication is prohibited.
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363
Unit 9
Lesson 3
324
Performing Preliminary Costing for Product
Cost Collector
LESSON OVERVIEW
This lesson explains how to perform preliminary costing for a product cost collector.
Business Example
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In this example, you will take a closer look at production for production orders. You will create
a production order in the master data and use a product cost collector as a cost object for
controlling by period. For this reason, you require the following knowledge:
●
An understanding of how to carry out preliminary costing for a product cost collector
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
364
Perform preliminary costing
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A manufacturer produces various types of pumps using the make-to-stock (MTS) production
method. Sales controlling is only carried out in Profitability Analysis (CO-PA). The popular
types of pump are produced in a continuous production process and mapped in the system
with repetitive manufacturing. A less popular pump type is to be produced solely on the basis
of the lot size with the production orders and only when the stock in the warehouse drops
below the reorder point. To be able to compare the cost objects more effectively, all the
production processes must be accompanied by controlling by period. Each pump has a
production version for repetitive manufacturing and another production version for orderrelated production.
Lesson: Performing Preliminary Costing for Product Cost Collector
Preliminary Costing for a Product Cost Collector
You can create a preliminary cost estimate for a product cost collector. The preliminary cost
estimate costs the quantity structure defined by the production process. If you use the
controlling level material by production plant and planning plant, you cannot create a
preliminary cost estimate for the product cost collector.
In repetitive manufacturing, the activity quantities determined in preliminary costing can be
used as default values for the confirmations. This requires you to make the appropriate
settings in Customizing in the repetitive manufacturing profile.
On the basis of preliminary costing, you calculate target costs to valuate the following:
●
Work in process (WIP)
●
Scrap variances
In repetitive manufacturing, you can update the preliminary cost estimate to convert the
quantities confirmed at the reporting points to the new reporting point structure. This is
necessary when the reporting point structure of your routing changes.
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365
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Duplication is prohibited.
Figure 135: Preliminary Costing – Overview (1)
Unit 9: Product Cost Controlling by Period
Facilitator
Producer
Say:
-
"You're going to work in two-person
teams to discuss the following question
[TBD] using private chat".
Do:
-
-
"I'll give you 5 minutes to work with your
partner and then we'll summarize briefly
as a group".
Type the names of the groups on the
whiteboard.
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Do:
-
-
-
-
366
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Duplication is prohibited.
Duplication is prohibited.
-
Assign participants to two-person
teams.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
© Copyright. All rights reserved.
Lesson: Performing Preliminary Costing for Product Cost Collector
INTERACTIVE ELEMENT:
1. With your partner, answer the following question. Using private chat, take 5 minutes
and discuss your ideas with your partner. Be ready to report back to the class with your
answers.
●
Why is preliminary costing performed?
.
.
.
.
.
.
.
.
.
Preliminary Costing – Overview
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Duplication is prohibited.
.
Figure 136: Preliminary Costing – Overview (2)
The production process quantity structure is valuated as defined in the valuation variant of
the costing variant. Basic for valuation could be the following:
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367
Unit 9: Product Cost Controlling by Period
●
Plan Costs / Preliminary Cost Estimate (of the cost object)
●
Current Standard Cost Estimate (of the material you produce)
●
Alternative Material Cost Estimate (for comparison)
Figure 137: Preliminary Costing – Direct Materials Costs
To calculate direct material costs, the input quantities of the materials determined by the bill
of material (BOM) are multiplied by the prices selected through the valuation variant. The
system uses the BOM of the production process. The production process results from the
controlling level and its selection (for example, BOM and routing).
You have already specified which costing variant and valuation variant are used by the
preliminary cost estimate in Customizing for Define Cost-Accounting-Relevant Default Values
for Order Types and Plants.
368
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Duplication is prohibited.
Preliminary Costing – Direct Materials Costs
Lesson: Performing Preliminary Costing for Product Cost Collector
Preliminary Costing – Direct Costs of Production
The system calculates the direct cost of production by multiplying the planned setup times,
machine times, and labor times, by the prices selected in accordance with the valuation
variant, to calculate the direct costs of production. The system uses the routing of the
production process.
The standard values are specified in the operations in the routing and can be defined as
follows:
●
Fixed standard values:
For example, setup costs, which are independent of the production quantity and also
known as ordering costs. They can still indicate stepped costs for technical reasons, such
as a tool change required above a certain order quantity. These are known as semivariable costs.
●
Variable standard values (lot size dependent):
For example, labor and machine time, which are multiplied by the costing lot size and
divided by the base quantity on which the standard values are based.
The exact algorithm is stored in formulas for the work center, which is assigned to the
individual operations of the routing. The cost center and the activity type for each operation
are in turn assigned to the work center. This determines the price of the activity.
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369
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Duplication is prohibited.
Figure 138: Preliminary Costing – Direct Costs of Production
Unit 9: Product Cost Controlling by Period
Preliminary Costing – Process Costs
Figure 139: Preliminary Costing – Process Costs
Duplication is prohibited.
The template allocation technique allocates the Activity-Based Costing (CO-OM-ABC)
processes with activity types of the cost centers. In principle, all information in the system
can be used as the cause value or cost driver.
The process template is determined on the basis of the following parameters:
●
●
The costing sheet for the application of overhead is selected with the valuation variant.
The overhead key is entered directly in the cost object or derived from the overhead group
from the material master (view tab costing 1).
With the combination of overhead key and costing sheet, you can assign a template in
Customizing.
The templates are grouped in Customizing by their usage or environment. For example, a
template of the material cost estimate environment can only be used for product costing and
PP production orders while a template of the sales order environment can only be used for
sales orders.
370
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Template allocation is an innovative technique for allocating the costs of Overhead Cost
Controlling. All Controlling objects are suitable for use as receivers, especially cost objects
and the profitability segments of CO-PA.
Lesson: Performing Preliminary Costing for Product Cost Collector
Preliminary Costing – Overhead Costs
In standard cost accounting, overhead costs are allocated to cost objects with overhead
surcharges. In Actual Costing, when these cost objects are debited, overhead cost objects
(such as cost centers or orders) are credited in return. In the preliminary cost estimate, no
credit will be posted. Nevertheless, the credit element is needed to select the cost element, on
which the OVH amount will be posted for preliminary cost estimate and in actual costing. You
can define both quantity-based and percentage overhead rates.
Overhead is calculated using a costing sheet. The assignment of the costing sheet is defined
in the customizing transaction Define Cost-Accounting relevant Default Values for Order Types
and Plants.
The costing sheet consists of the following types of rows:
●
Base rows:
Here, you enter cost elements, cost element groups, and origin groups to which overhead
must be applied.
●
Overhead rate rows:
Here, you specify the overhead rates to be used in applying overheads to the base rows.
●
Credits:
Here, you enter the overhead cost objects (such as cost center, process, or internal
orders) that must be credited under each cost element.
If you want to apply overhead in different ways, depending on the material being
manufactured, you can use the overhead keys. You then define overhead rates based on the
overhead keys that can be derived from overhead groups in Customizing. You enter overhead
groups in the material master record.
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371
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Duplication is prohibited.
Figure 140: Preliminary Costing – Overhead Costs
Unit 9: Product Cost Controlling by Period
In preliminary costing for the product cost collector, the system uses the costing sheet
specified in the planned valuation variant. In simultaneous costing for the product cost
collector, the system uses the costing sheet specified in the actual valuation variant. This
costing sheet is displayed in the product cost collector.
How to Perform Preliminary Costing
Demonstrate the steps listed in the Perform Preliminary Costing exercise.
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Duplication is prohibited.
372
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Unit 9
Exercise 17
333
Perform Preliminary Costing
Business Example
You want to analyze the preliminary cost estimate for your product cost collector. In the
previous exercise, when creating a product cost collector for the gearbox, you confirmed the
creation of a preliminary cost estimate when saving your product cost collector. If not, you
can create the preliminary cost estimate for your existing product cost collector. Use the app
Maintain Product Cost Collectors.
Select your product cost collector and analyze the preliminary cost estimate.
1. Display the preliminary cost estimate for the product cost collector T-FL2## and plant
1010. Check the costs of goods manufactured for 10 pieces.
2. Display the itemization report for T-FL2##. Determine the calculated costs for the gear
wheel T-FL2B##.
How did the system calculate the quantity for the gear wheel?
3. Display the current material cost estimate for assembly T-FL2##. Use the app Display
Material Cost Estimates and select using the material number and the costing variant
PPC1, version 1 in plant 1010. Compare the preliminary cost estimate calculated for the
product cost collector for assembly T-FL2## to the current released material cost
estimate for this product.
How can there be differences between these two cost estimates?
4. The planned costs were calculated using costing variant PREM. Check the assignment of
this costing variant to order type RM01 in the default values of plant 1000.
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373
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Duplication is prohibited.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
Unit 9: Product Cost Controlling by Period
Which costing variant was assigned for this simultaneous costing?
5. Display the Customizing settings for the preliminary cost estimate for the product cost
collector.
Which valuation variant was assigned to calculate the planned order costs for costing
variant PSRM?
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Duplication is prohibited.
374
© Copyright. All rights reserved.
Unit 9
Solution 17
335
Perform Preliminary Costing
Business Example
You want to analyze the preliminary cost estimate for your product cost collector. In the
previous exercise, when creating a product cost collector for the gearbox, you confirmed the
creation of a preliminary cost estimate when saving your product cost collector. If not, you
can create the preliminary cost estimate for your existing product cost collector. Use the app
Maintain Product Cost Collectors.
Select your product cost collector and analyze the preliminary cost estimate.
1. Display the preliminary cost estimate for the product cost collector T-FL2## and plant
1010. Check the costs of goods manufactured for 10 pieces.
a) On the SAP Fiori Launch Pad, select the app Maintain Product Cost Collectors.
b) On the Display Product Cost Collector screen, enter the following data, then press
Enter.
Field
Value
Material
T-FL2##
Plant
1010
c) On the Products Cost Collectors for Selection area, select your product cost collector.
Now you have access to your product cost collector.
d) On the Display Product Cost Collector screen, choose More → Go to → Display Cost
Estimate.
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375
Duplication is prohibited.
Duplication is prohibited.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
Unit 9: Product Cost Controlling by Period
Note:
If you did not create a preliminary cost estimate in the previous exercises,
do the following:
●
●
●
Switch the access to your product cost collector from Display to Change
(icon on top of the screen).
Go to More → Edit → Cost.
Save your product cost collector. You already created the preliminary
cost estimate.
e) Check the costing lot size. You can change it by entering 10 in the Costs based on field
and selecting User Entry.
2. Display the itemization report for T-FL2##. Determine the calculated costs for the gear
wheel T-FL2B##.
How did the system calculate the quantity for the gear wheel?
a) The calculated costs for the gear wheel are displayed in the Costing Structure report
on the left side, and in the Itemization report below the header data of the preliminary
cost estimate.
b) To navigate to the BOM, choose Information on Cost Estimate.
c) In the Explanation Facilities dialog box, choose Bill of Materials.
d) On the Display Material BOM: HEADER: Quantities - long text screen, choose More →
Goto → Item Overview.
e) In the Display Material BOM: General Item Overview screen, you see the quantity for
the material T-FL2B## (gear wheel).
f) Navigate to the Display Material BOM: Header Overview dialog box by choosing
More → Goto → Header.
g) Check the Base Quantity.
3. Display the current material cost estimate for assembly T-FL2##. Use the app Display
Material Cost Estimates and select using the material number and the costing variant
PPC1, version 1 in plant 1010. Compare the preliminary cost estimate calculated for the
product cost collector for assembly T-FL2## to the current released material cost
estimate for this product.
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The quantity has been calculated based on the BOM of T-FL2##. You can see the base
quantity of T-FL2##, on which the quantity for T-FL2B## is calculated, in the Display
Material BOM: Header Overview dialog box.
Lesson: Performing Preliminary Costing for Product Cost Collector
How can there be differences between these two cost estimates?
The costing variant used to calculate the standard cost estimate and the costing variant
used to calculate the product cost collector may use different valuation variants. However,
even if the same valuation variants are used, the prices of the component materials and
the activity prices might have changed between the time when the standard cost estimate
was created and the time when the cost was calculated for the product cost collector.
Also, the current BOM or routing (quantity structure) may differ from the quantity
structure used in the standard cost estimate. In addition, if more than one procurement
process is available for T-FL2##, mixed costing could have been used to calculate the
standard.
a) In the SAP Fiori Launch Pad, select the app Display Material Cost Estimates.
Field
Value
Material
T-FL2##
Plant
1010
Costing Variant
PPC1
Costing Version
1
Valid on
Current date
c) Change the Costs Based On to user entry with 10 PC.
4. The planned costs were calculated using costing variant PREM. Check the assignment of
this costing variant to order type RM01 in the default values of plant 1000.
Which costing variant was assigned for this simultaneous costing?
The costing variant for simultaneous costing is PSRM.
a) Select system T41 client 400. In the SAP Easy Access Menu, select transaction SPRO.
In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Product Cost Collectors → Define CostAccounting-Relevant Default Values for Order Types and Plants (OKZ3).
b) On the Change View “Default Values for Order Cost Estimate”: Overview screen, select
the row for plant 1010 and order type RM01.
c) Choose the Details button.
5. Display the Customizing settings for the preliminary cost estimate for the product cost
collector.
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b) On the Display Material Cost Estimate with quantity structure selection screen, enter
the following data, then press Enter.
Unit 9: Product Cost Controlling by Period
Which valuation variant was assigned to calculate the planned order costs for costing
variant PSRM?
The valuation variant is 0RM (REM Order: Actual).
a) Select system T41 client 400. In the SAP Easy Access Menu, select transaction SPRO.
In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Product Cost Collectors → Check Costing
Variants for Product Cost Collectors.
b) In the Choose Activity dialog box, choose Costing Variants for Valuation of Internal
Activities.
c) On the Change View “Costing Variants”: Overview screen, choose costing variant PSRM
and choose the Details button.
d) On the Change View “Costing Variants”: Details screen, choose the Valuation Variant
button.
e) Select Detail.
f) Select the Activity Types / Processes tab.
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Note:
Within simultaneous costing, the plan price for the period is used for
activity types. The allocation of actual activity quantity is usually valuated
with the activity price in the current period. In contrast, the preliminary
cost estimate of the product cost collector and the material cost estimate
normally use the annual average price. If the activity price is different
between periods, the variance analysis of the product cost collector
contains price variances.
Lesson: Performing Preliminary Costing for Product Cost Collector
LESSON SUMMARY
You should now be able to:
●
Perform preliminary costing
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379
Unit 9
Lesson 4
340
Performing Simultaneous Costing for Product
Cost Collector
LESSON OVERVIEW
This lesson explains how to perform simultaneous costing for a product cost collector.
Business Example
A manufacturer produces fork lifts. Various assemblies for the forklifts are produced with the
make-to-stock (MTS) production method. The assemblies for the gearbox are produced in a
continuous production process but using production orders and product cost collectors.
In this example, you will take a closer look at the actual costs for production orders. During
production, goods issues and confirmations for the production order are carried out while
direct posting from Financial Accounting (FI) directly address the product cost collector.
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380
●
Debit the product cost collector with actual costs
●
Credit the product cost collector with actual costs
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
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Lesson: Performing Simultaneous Costing for Product Cost Collector
Figure 141: Production Order and Product Cost Collector – Process Chain
The so called de-coupling scenario leads to the posting of all logistic processes to the
production order, and the valuation of such processes to the product cost collector. The
following processes lead to actual posting on the product cost collector:
●
Material withdrawal of the primary products
●
Goods receipt of yield quantities
●
Confirmation of actual yield and scrap quantities, and actual time needed
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Actual Costs on Product Cost Collector
Unit 9: Product Cost Controlling by Period
Figure 142: Debit of Product Cost Collector with Actual Costs
●
General ledger (G/L) account postings in FI
●
Goods movements in Materials Management (MM)
●
Reposting of primary costs
●
Reposting of line items
●
Internal activity allocations
●
Reposting of internal activity allocations
●
Direct assignment of personnel costs to cost objects using time sheets
●
Process cost allocation
●
Manual process allocation
●
Template allocation
●
Calculation of overheads
●
Revaluation of activities at actual prices
●
Confirmations in Logistics that result in activity allocations
●
Subcontracting
Logistical functions, such as goods issues and confirmations, are still performed with
reference to the manufacturing order or in repetitive manufacturing, with reference to the
production version. The resulting costs are updated in the product cost collector.
You can enter goods issues, confirmations, and goods receipts independently of each other.
You can also have activity allocations and goods issues or goods receipts generated
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The following business transactions can result in actual costs on cost objects:
Lesson: Performing Simultaneous Costing for Product Cost Collector
automatically when you confirm the settings. You can make the settings that enable this in
logistics. You can confirm the order header or individual operations.
In the Product Cost by Period scenario, you are recommended to confirm operations. This
affects how work in process (WIP) is calculated.
How to Post Goods Issue and Confirmation to the Production Order
Demonstrate the steps listed in the Post Goods Issue and Confirmation to the Production
Order exercise.
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383
Unit 9: Product Cost Controlling by Period
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384
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Unit 9
Exercise 18
345
Post Goods Issue and Confirmation to the
Production Order
Business Example
You start the production process with goods issue and confirmation of yield and scrap
quantities. The actual material costs for goods issue and activity costs with confirmation for
operations will be posted on the product cost collector.
Note:
The parameters of an operation enables automatic confirmation of the previous
operations (milestone operation). In this exercise, the routing of the production
order has two operations, from which the second one has been marked as a
milestone operation. Therefore, the confirmation to the second operation leads to
an automatic target = actual confirmation to the first operation.
Another parameter is the automatic posting of a goods receipt based on the
confirmed yield quantity. This parameter has not been set. Therefore, the posting
of the goods movement is a separate process in the next exercise.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Post a goods receipt for material T-FL2A## (clutch) about 20 PC and material T-FL2B##
about 20 PC using the app Post Goods Movement in the tile group Production Planning &
Material Management. Post the goods issue for the production order. Due to the material
scrap that occurred during assembly, change the withdrawal quantity of material T—
FL2A## (Clutch) from 10 to 11 PC. Use the app Post Goods Movement in the tile group
Production Planning & Material Management and select the executable action Goods Issue
with Reference Document. The type of reference document is Order.
2. Enter the following confirmations for your production order:
Flag Clear Reservation: Deselect.
Operation
Type of Confirmation
Yield Quantity
Scrap Quantity
10
Final
10
—
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385
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The production order has been released to the shop floor, and inventory transactions and
production confirmations can be posted against the order. You do not use milestone
confirmation, which means that each operation must be confirmed. Simultaneous costing is
recorded on the assigned product cost collector.
Unit 9: Product Cost Controlling by Period
Flag Clear Reservation: Deselect.
Operation
Type of Confirmation
Yield Quantity
Scrap Quantity
20
Partial
8
1
Note:
Due to the controlling concept that is used (Product Cost by Period), the
calculation of WIP and variances will be done simultaneously in the period-end
closing, although the confirmation for the second and last operation will be
performed as “Partial Confirmation”. Two pieces of the confirmed yield
quantity in the first operation will not be confirmed as yield quantity in the
following operation, because one piece is not finished (Work in Process) with a
WIP quantity of 1 PC at the first operation. The other piece is broken in the
second operation, and will be confirmed as scrap.
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386
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Unit 9
Solution 18
347
Post Goods Issue and Confirmation to the
Production Order
Business Example
You start the production process with goods issue and confirmation of yield and scrap
quantities. The actual material costs for goods issue and activity costs with confirmation for
operations will be posted on the product cost collector.
Note:
The parameters of an operation enables automatic confirmation of the previous
operations (milestone operation). In this exercise, the routing of the production
order has two operations, from which the second one has been marked as a
milestone operation. Therefore, the confirmation to the second operation leads to
an automatic target = actual confirmation to the first operation.
Another parameter is the automatic posting of a goods receipt based on the
confirmed yield quantity. This parameter has not been set. Therefore, the posting
of the goods movement is a separate process in the next exercise.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Post a goods receipt for material T-FL2A## (clutch) about 20 PC and material T-FL2B##
about 20 PC using the app Post Goods Movement in the tile group Production Planning &
Material Management. Post the goods issue for the production order. Due to the material
scrap that occurred during assembly, change the withdrawal quantity of material T—
FL2A## (Clutch) from 10 to 11 PC. Use the app Post Goods Movement in the tile group
Production Planning & Material Management and select the executable action Goods Issue
with Reference Document. The type of reference document is Order.
a) On the SAP Fiori Launch Pad, select the app Post Goods Movement in the tile group
Production Planning & Material Management.
b) In the Goods Issue Order — S4F25–## screen, select the Transaction/Event = Goods
Receipt. Select the Reference Document = Other.
c) In the Detail Data area of the screen, enter:
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387
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The production order has been released to the shop floor, and inventory transactions and
production confirmations can be posted against the order. You do not use milestone
confirmation, which means that each operation must be confirmed. Simultaneous costing is
recorded on the assigned product cost collector.
Unit 9: Product Cost Controlling by Period
Material No.
Quantity
Plant
Storage Location
T-FL2A##
20
1010
101A
T-FL2B##
20
1010
101A
d) Save the goods receipt using Post.
e) Stay in the app Post Goods Movement.
f) On the Goods Issue screen, enter the following:
Field Name
Value
Executable action in transaction MIGO
Goods Issue
Reference Document for MIGO transaction
Order
Document number
Your production order number
g) Press Enter to select the reservation list for the material, then choose Close detail data.
h) Change the quantity in the row with material T-FL2A## (Clutch) from 10 to 11 PC.
i) Mark all rows of the materials with OK.
j) Choose POST.
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Flag Clear Reservation: Deselect.
Operation
Type of Confirmation
Yield Quantity
Scrap Quantity
10
Final
10
—
20
Partial
8
1
Note:
Due to the controlling concept that is used (Product Cost by Period), the
calculation of WIP and variances will be done simultaneously in the period-end
closing, although the confirmation for the second and last operation will be
performed as “Partial Confirmation”. Two pieces of the confirmed yield
quantity in the first operation will not be confirmed as yield quantity in the
following operation, because one piece is not finished (Work in Process) with a
WIP quantity of 1 PC at the first operation. The other piece is broken in the
second operation, and will be confirmed as scrap.
a) On the SAP Fiori Launchpad, select the app Confirm Production Order Operation.
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2. Enter the following confirmations for your production order:
Lesson: Performing Simultaneous Costing for Product Cost Collector
Note:
This app for confirmation to the production order is type Time Ticket.
b) On the Enter Time Ticket for Production Order screen, enter the following data:
Field Name
Value
Order
Your production order number
Operation
0010
Confirmation Type
Final Confirmation
c) Choose Enter to select the data from the operation.
d) Enter the following data:
Field Name
Value
To be confirmed: Yield
10
To be confirmed: Scrap
–
Note:
If you receive the following information: Actual data for QM characteristics
of operation 0010 missing, confirm that message with pushing continue. In
this exercise, no QM - data (quality management) will be entered.
f) Enter the confirmation for the second and last operation. On the Enter Time Ticket for
Production Order screen, enter the following data:
Field Name
Value
Order
Your production order number
Operation
0020
Confirmation Type
Partial Confirmation
g) Choose Enter to select the data from the operation.
h) Enter the following data:
Field Name
Value
To be confirmed: Yield
8
To be confirmed: Scrap
1
Labor Time
Increase the value by 10 %
i) Choose Enter .
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e) Choose Save to save the first confirmation, and stay in the app..
Unit 9: Product Cost Controlling by Period
A message tells you that the activities are recalculated due to the quantity change (of
the labor time).
j) Push Continue.
Note:
If you receive the message, Actual data for QM characteristics
of operation 0020 missing, confirm the message by choosing
Continue. In this exercise, no quality management (QM) data will be
entered.
k) Save your confirmation data by choosing Save.
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Lesson: Performing Simultaneous Costing for Product Cost Collector
Figure 143: Credit of Product Cost Collector by Goods Receipt
The indicators that determine price control for the material are set in the material master
record.
The price control indicators are as follows:
●
Price control indicator V:
The material is valuated at the moving average price (unit price). The moving average price
changes with each goods movement or when the orders from Cost Object Controlling are
settled. The value of the goods receipt is determined by the valuation variant for delivery.
●
Price control indicator S:
The material is valuated at the standard price. In MTS production, this price is usually
calculated in a standard cost estimate for the material. In sales order-related production
with valuated sales order stock, the valuation price is selected using a predefined valuation
strategy and acts as a standard price.
Note:
SAP recommends that you use the price indication S for in-house production
material. Partial deliveries of parallel production orders might cause mistakes in
the moving average price. For a missing material cost estimate, a completely
production controlling is not available, because target costs could not be
calculated.
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Goods Receipts
Unit 9: Product Cost Controlling by Period
For materials whose price control indicator is S, the system valuates the stock receipts at a
standard price. The credit applied to the product cost collector is the quantity received in the
inventory multiplied by the standard price.
For materials whose price control indicator is V, the stock receipt and the credit to the
product cost collector are controlled by the valuation variant for delivery. The valuation
variant for delivery determines which price field from the material master is selected to
valuate the goods receipt. When the product cost collector is settled during period-end
closing, the posting for materials with price control indicator S can differ from those for
materials with price control indicator V.
When the goods receipt is entered, the system automatically debits the balance sheet
account and credits the inventory change account. The system credits the product cost
collector using the primary cost element that corresponds to the plant activity account
(inventory change account).
Facilitator
Producer
Say:
-
"Take [To Be Determined] minutes to
write down in your Participant Handbook".
Do:
-
"Let me know when you're done by using
the green check mark (Agree) status
icon".
Assign spaces and whiteboard tools to
participants.
Do:
-
-
-
-
-
-
392
Provide specific instructions for the activity.
If numbers are used, assign numbers to
participants.
Give participants a time limit to complete
the activity.
Take some time to discuss the results
with participants.
If desired, save the whiteboard results
for later reference or distribution.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
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-
If required, assign whiteboard permissions.
Lesson: Performing Simultaneous Costing for Product Cost Collector
INTERACTIVE ELEMENT: Whiteboard
1. Take 5 minutes to write down answers to the following question in your Participant
Handbook:
What is the function of price control indicator S?
.
.
.
.
.
.
.
.
.
FACILITATED DISCUSSION
Why is it recommended to valuate at the standard price for materials manufactured in-house?
How to Post a Goods Receipt to a Production Order
Demonstrate the steps listed in the Post a Goods Receipt to Production Order exercise.
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.
Unit 9: Product Cost Controlling by Period
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394
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Unit 9
Exercise 19
353
Post Goods Receipts to a Production Order
Business Example
Goods receipts can be processed either manually (using Inventory Management) or
automatically (during production confirmation). This depends on the control key of the
operation. In the previous exercise, yield and scrap quantities have been confirmed. The
control key in the operation, which has been confirmed, does not post an automatic goods
receipts. Therefore, the goods receipts will be posted manually in this exercise. Only
confirmed yield quantities at the last operation will be posted as goods receipts.
Any changes to the suggested quantities (target quantities) cause quantity variances for the
variance calculation that is carried out later, during period-end closing.
Note:
In this exercise, ## is used as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
Task 1: Enter Goods Receipts
1. Post the goods receipts for the production order using the app Post Goods Movement. The
quantity is 8 PC.
Hint:
The control key in the operation 0020 does not include an automatic goods
receipts within posting the confirmation to that operation.
Task 2: Review the Actual Cost Information
Use the target/actual comparison report to review the actual cost information for the product
cost collector of material T-FL2##.
1. Analyze the actual costs that were debited to the product cost collector for your gearbox
assembly T-FL2##. Use the app Analyze Product Cost Collectors. Determine how the
costs were calculated.
2. Locate the amount credited to the product cost collector for the goods receipts of TFL2##.
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Credit the product cost collector by posting goods receipts.
Unit 9: Product Cost Controlling by Period
Was the cost collector credited for the confirmation of the assembly that was reported as
scrap?
3. What value was used to credit the product cost collector for the goods receipts of the
gearbox assembly?
Task 3: Review the Settings for Simultaneous Costing of Costs for Product Cost Collector
The actual costs for the activities were calculated using costing variant PSRM. Review the
Customizing settings for simultaneous costing of the costs for the product cost collector.
1. Display the assignment of this costing variant to the order type RM01 with default values
for plant 1010.
3. What price is selected for calculating the production costs? Is this the same price that was
used to determine planned costs (preliminary cost estimate) for the product cost
collector?
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2. Which valuation variant is assigned to calculate the actual order costs for costing variant
PSRM?
Unit 9
Solution 19
355
Post Goods Receipts to a Production Order
Business Example
Goods receipts can be processed either manually (using Inventory Management) or
automatically (during production confirmation). This depends on the control key of the
operation. In the previous exercise, yield and scrap quantities have been confirmed. The
control key in the operation, which has been confirmed, does not post an automatic goods
receipts. Therefore, the goods receipts will be posted manually in this exercise. Only
confirmed yield quantities at the last operation will be posted as goods receipts.
Any changes to the suggested quantities (target quantities) cause quantity variances for the
variance calculation that is carried out later, during period-end closing.
Note:
In this exercise, ## is used as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
Task 1: Enter Goods Receipts
1. Post the goods receipts for the production order using the app Post Goods Movement. The
quantity is 8 PC.
Hint:
The control key in the operation 0020 does not include an automatic goods
receipts within posting the confirmation to that operation.
a) On the SAP Fiori Launch Pad, select the app Post Goods Movement.
b) In the field Executable Action in Transaction MIGO, select the transaction Goods
Receipts.
c) In the field Reference Document for MIGO Transaction, select Order.
d) In the field Order Number enter the number of your production order.
e) Choose Enter to select the data from your production order.
f) The system might propose 10 PC, which is incorrect because you confirmed 8 PC
yield quantity. Because of this, change the quantity to 8 PC.
g) In the Material Document Item field, set the flag OK, then choose Post.
The app will create a material document item.
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Credit the product cost collector by posting goods receipts.
Unit 9: Product Cost Controlling by Period
Task 2: Review the Actual Cost Information
Use the target/actual comparison report to review the actual cost information for the product
cost collector of material T-FL2##.
1. Analyze the actual costs that were debited to the product cost collector for your gearbox
assembly T-FL2##. Use the app Analyze Product Cost Collectors. Determine how the
costs were calculated.
a) On the SAP Fiori launchpad, select the app Analyze Product Cost Collectors.
b) On the Analyze Product Cost Collectors — Target/Actual Comparison screen, enter the
following data:
Field
Value
Material
T-FL2##
Plant
1010
Time Frame
Cumulated
c) Choose the Execute button.
d) To get a better overview of the report data, select a column with costs and choose the
Total button.
Now, the function with the Subtotals button is available.
Note:
If the characteristic is not assigned to the report layout, choose the Change
Layout button and assign the characteristic Debit Indicator from the
column set.
2. Locate the amount credited to the product cost collector for the goods receipts of TFL2##.
Was the cost collector credited for the confirmation of the assembly that was reported as
scrap?
The product cost collector was credited for the goods receipt posting of eight pieces. One
piece, that was confirmed in the first operation as yield quantity, has not been finished and
therefore will be calculated as WIP. One piece that was reported as scrap is not credited to
the product cost collector but will be calculated as a scrap value when variances are
calculated for the product cost collector.
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e) Position your cursor on the Debit Indicator column, and choose the Subtotals button.
Lesson: Performing Simultaneous Costing for Product Cost Collector
3. What value was used to credit the product cost collector for the goods receipts of the
gearbox assembly?
The standard cost estimate was used to valuate the goods receipts. All the materials
that use standard price control also credit the product cost collector with the
standard price. Only materials with a moving average price use a valuation variant to
determine the cost object credit at the time of goods receipts. This can be confirmed by
displaying the Accounting 1 view in the material master of T-FL2##, and locating the Price
Control S field and the current standard price value.
Task 3: Review the Settings for Simultaneous Costing of Costs for Product Cost Collector
The actual costs for the activities were calculated using costing variant PSRM. Review the
Customizing settings for simultaneous costing of the costs for the product cost collector.
1. Display the assignment of this costing variant to the order type RM01 with default values
for plant 1010.
a) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Product Cost Collectors → Define CostAccounting-Relevant Default Values for Order Types and Plants ( OKZ3).
b) On the Change View “Default Values for Order Cost Estimate”: Overview screen, choose
the row for plant 1010 and order type RM01.
2. Which valuation variant is assigned to calculate the actual order costs for costing variant
PSRM?
The valuation variant REM order actual (0RM) is assigned to calculate the actual order
costs for costing variant PSRM.
a) Execute transaction OPL1.
b) On the Change View “Costing Variants” Overview screen, choose PSRM in the Costing
Variant column.
c) Choose the Details button.
3. What price is selected for calculating the production costs? Is this the same price that was
used to determine planned costs (preliminary cost estimate) for the product cost
collector?
The price selection strategy sequence is “Valuation Price According to Price Control in
Material Master”. In the training system, the costing variant for preliminary cost estimate
PYRM uses the valuation variant 0Y6 . The costing variant for actual costs PSRM uses the
valuation variant 0RM. Both valuation variants might have the same customizing, but
could be different. Usually, the cost estimate selects average prices, and actual costing of
the price of the current period.
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399
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c) Choose the Details button.
The costing variant for simultaneous costing is PSRM.
Unit 9: Product Cost Controlling by Period
a) On the Change View “Costing Variants”: Details screen, choose the Valuation Variant
button.
b) On the Activity Types/Processes tab page, the strategy sequence for the actual costs
is Plan Price for the Period.
c) Go back to the SAP Easy Access screen to display the planned cost strategy.
d) Execute transaction OPL1.
e) On the Change View “Costing Variants”: Overview screen, choose PSRM in the Costing
Variant column.
f) Choose the Details button.
g) Choose the Valuation Variant button.
h) Choose the Activity Types/Processes tab page.
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Lesson: Performing Simultaneous Costing for Product Cost Collector
LESSON SUMMARY
You should now be able to:
●
Debit the product cost collector with actual costs
●
Credit the product cost collector with actual costs
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401
Unit 9: Product Cost Controlling by Period
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Unit 9
361
Learning Assessment
1. Which of the following types of posting is posted with reference to the production order?
Choose the correct answer.
X
A Billing document
X
B Confirmations
X
C Change request
X
D Notification
2. What are valid controlling levels of a product cost collector?
X
A Material and plant
X
B Plant
X
C Material and production version
X
D Material, plant, BOM and routing
3. What needs to be specified to calculate work in process (WIP) in a product cost collector?
Choose the correct answer.
X
A Default rule
X
B Order type
X
C Results analysis key
X
D Settlement type
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403
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answers.
Unit 9: Learning Assessment
4. What status is assigned to the production order, if you assign a production order to a
product cost collector (PCC)?
Choose the correct answer.
X
A REL
X
B PCC
X
C CRTD
X
D SETC
5. Which of the following statements about the costing variant is correct ?
Choose the correct answer.
X
A The actual costing variant is needed to calculate the actual costs of the production
order.
X
B The plan costing variant is needed to calculate the plan cost of the production
order.
6. Which of the following statements about the plan cost of production orders is correct?
X
A The plan cost of the production order could be analyzed in reporting of Product
Cost by Period.
X
B The plan cost of the production order could be analyzed in reporting of Product
Cost by Order.
X
C The plan cost of the production order is only used for ad hoc analysis, because plan
cost are not available in the reporting of the product cost collector.
7. To calculate the direct costs of production, the system multiplies the prices selected in
accordance with the valuation variant, by which of the following?
Choose the correct answers.
404
X
A Planned setup times
X
B Machine times
X
C Setup costs
X
D Labor times
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Duplication is prohibited.
Choose the correct answer.
Unit 9: Learning Assessment
8. For which cost object can you calculate plan cost in Product Cost by Period?
Choose the correct answer.
X
A Production Process
X
B Production Order
X
C Product Cost Collector
9. Which price control indicator is selected to valuate material at the standard price?
Choose the correct answer.
X
A Price control indicator V
X
B Price control indicator S
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Duplication is prohibited.
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405
Unit 9
364
Learning Assessment - Answers
1. Which of the following types of posting is posted with reference to the production order?
Choose the correct answer.
X
A Billing document
X
B Confirmations
X
C Change request
X
D Notification
Correct. The confirmation refers to a production order.
Duplication is prohibited.
Choose the correct answers.
X
A Material and plant
X
B Plant
X
C Material and production version
X
D Material, plant, BOM and routing
Correct. The controlling level always includes the material.
3. What needs to be specified to calculate work in process (WIP) in a product cost collector?
Choose the correct answer.
X
A Default rule
X
B Order type
X
C Results analysis key
X
D Settlement type
Correct. The results analysis key must be maintained.
406
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Duplication is prohibited.
2. What are valid controlling levels of a product cost collector?
Unit 9: Learning Assessment - Answers
4. What status is assigned to the production order, if you assign a production order to a
product cost collector (PCC)?
Choose the correct answer.
X
A REL
X
B PCC
X
C CRTD
X
D SETC
Correct. Status PCC (Product Cost Collector) is automatically assigned.
5. Which of the following statements about the costing variant is correct ?
Choose the correct answer.
X
A The actual costing variant is needed to calculate the actual costs of the production
order.
X
B The plan costing variant is needed to calculate the plan cost of the production
order.
6. Which of the following statements about the plan cost of production orders is correct?
Choose the correct answer.
X
A The plan cost of the production order could be analyzed in reporting of Product
Cost by Period.
X
B The plan cost of the production order could be analyzed in reporting of Product
Cost by Order.
X
C The plan cost of the production order is only used for ad hoc analysis, because plan
cost are not available in the reporting of the product cost collector.
Correct. Plan costs are not available in the reporting of the product cost collector.
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407
Duplication is prohibited.
Duplication is prohibited.
Correct. The plan costing variant is a prerequisite for planning costs.
Unit 9: Learning Assessment - Answers
7. To calculate the direct costs of production, the system multiplies the prices selected in
accordance with the valuation variant, by which of the following?
Choose the correct answers.
X
A Planned setup times
X
B Machine times
X
C Setup costs
X
D Labor times
Correct. The setup costs is a fixed cost, so it isn’t part of the equation.
8. For which cost object can you calculate plan cost in Product Cost by Period?
Choose the correct answer.
X
A Production Process
X
B Production Order
X
C Product Cost Collector
9. Which price control indicator is selected to valuate material at the standard price?
Choose the correct answer.
X
A Price control indicator V
X
B Price control indicator S
Correct. S is the standard cost price control indicator.
408
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Duplication is prohibited.
Correct. Plan costs can be calculated for the order.
UNIT 10
Period-End Closing for Product
Cost Controlling by Period
Lesson 1
Outlining Period-End Closing for a Product Cost Collector
411
Lesson 2
Performing Template Allocation
Exercise 20: Perform Template Allocation
415
417
Lesson 3
Performing Revaluation at Actual Prices
423
Performing Actual Overhead Calculation
Exercise 21: Perform Actual Overhead Calculation
426
429
Lesson 5
Calculating Work in Process (WIP)
Exercise 22: Calculate Work in Process
434
437
Lesson 6
Performing Variance Calculation
Exercise 23: Execute Variance Calculation
448
457
Lesson 7
Performing Settlement
Exercise 24: Execute the Settlement of WIP and Variances for the Product Cost
Collector
464
471
UNIT OBJECTIVES
●
Outline period-end closing for a product cost collector
●
Perform template allocation
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409
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Duplication is prohibited.
Lesson 4
Unit 10: Period-End Closing for Product Cost Controlling by Period
●
Perform revaluation at actual prices
●
Perform actual overhead calculation
●
Calculate work in process (WIP)
●
Configure work in process (WIP)
●
Perform Variance Calculation
●
Configure variance calculation
●
Perform Settlement
Duplication is prohibited.
Duplication is prohibited.
410
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Unit 10
Lesson 1
369
Outlining Period-End Closing for a Product
Cost Collector
LESSON OVERVIEW
This lesson explains the typical steps for period-end closing in make-to-stock (MTS)
production with the Product Cost by Period component.
A manufacturer produces various types of pump using the MTS production method. Sales
controlling is only carried out in Profitability Analysis (CO-PA). The popular types of pump are
produced in a continuous production process and mapped in the system with repetitive
manufacturing. A less popular pump type is to be produced solely on the basis of the lot size
with production orders and only when the stock in the warehouse drops below the reorder
point. To be able to compare the cost objects more effectively, all the production processes
must be accompanied by controlling by period. Each pump has a production version for
repetitive manufacturing and another production version for order-related production. In this
example, you will take a closer look at production for production orders. For this reason, you
require the following knowledge:
●
An understanding of the steps for period-end closing in MTS production with the Product
Cost by Period component
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Outline period-end closing for a product cost collector
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411
Duplication is prohibited.
Duplication is prohibited.
Business Example:
Unit 10: Period-End Closing for Product Cost Controlling by Period
Period-End Closing for a Product Cost Collector
Figure 144: Period-End Closing for a Product Cost Collector
Duplication is prohibited.
●
●
●
Template allocation for automatic allocation of process costs and activity types
Revaluation at actual prices for activity types and business processes, which could debit or
credit the cost object, based on the new price calculation
Allocation of overhead surcharge
The components of final costing are as follows:
●
●
Calculation of work in process (WIP) – in the Product Cost by Period component, WIP is
calculated at target cost
The variance calculation function examines the causes of the order balance, and also
provides reasons explaining why the production process costs more than estimated
The characteristics of settlement are as follows:
●
●
412
The system settles the WIP to Financial Accounting (FI) including Profit Center Accounting
in FI.
The system settles the order balance to FI and to the Material Ledger, which is active by
default in SAP S/4HANA.
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Duplication is prohibited.
The functions in the period-end closing process for product cost collectors are as follows:
Lesson: Outlining Period-End Closing for a Product Cost Collector
Note:
In SAP S/4HANA, you can use the Customizing activity Define Accounts for
Splitting Price Differences to refine the FI posting to show the different variance
categories on different G/L accounts. This allows you to show in your income
statement, the reasons for the production differences.
The system settles the variance categories to CO-PA, if implemented.
●
Facilitator
Producer
Say:
-
"You're going to work in two-person
teams to discuss the following question
using private chat".
Do:
-
-
"I'll give you 5 minutes to work with your
partner and then we'll summarize briefly
as a group".
During the full group debrief, capture the
participants’ suggestions on the whiteboard for the immediate discussion and
for later reference or distribution.
Duplication is prohibited.
Duplication is prohibited.
-
Type the names of the groups on the
whiteboard.
Do:
-
-
-
-
-
Assign participants to two-person
teams.
Remind participants about how to use
private chat.
Explain that the purpose of this activity is
to discuss the question on the whiteboard or PPT slide.
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
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413
Unit 10: Period-End Closing for Product Cost Controlling by Period
INTERACTIVE ELEMENT: Chat
1. Together with your partner, answer the following question:
What are the functions in period-end closing for the product cost collector?
Using private chat, take 5 minutes to discuss your ideas with your partner.
Be ready to report back to the class with your answers.
.
.
.
.
.
.
.
.
.
Duplication is prohibited.
Duplication is prohibited.
.
LESSON SUMMARY
You should now be able to:
●
414
Outline period-end closing for a product cost collector
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Unit 10
Lesson 2
372
Performing Template Allocation
LESSON OVERVIEW
This lesson explains how to perform template allocation.
Business Example
Producing the assemblies for the forklift, period-end closing is carried out entirely in this
scenario on the product cost collector. Periodic Costs for quality management and internal
transport are allocated to the product cost collector. The technique used is the quantity
based allocation with TEMPLATE.
For this reason, you require the following knowledge:
●
An understanding of how to perform template allocation
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Perform template allocation
Duplication is prohibited.
Duplication is prohibited.
●
Template Allocation
Figure 145: Template Allocation
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415
Unit 10: Period-End Closing for Product Cost Controlling by Period
Template allocation is a technique for transferring the costs of Overhead Cost Controlling to
other Controlling objects on the basis of consumption. All Controlling objects are suitable for
use as receivers, especially cost objects.
Note:
In SAP S/4HANA release 1610, the template allocation to CO PA is not available.
The template allocation technique allocates processes of Activity-Based Costing (CO-OMABC) with the help of activity types from cost center to other controlling objects.
The process template is determined dynamically based on the following parameters:
●
●
●
The system selects the costing sheet for the application of overhead with the valuation
variant.
You can either enter the overhead key directly in the cost object or derive it from the
overhead group from the material master (costing 1 view).
You can assign a template in Customizing with the combination of overhead key and
costing sheet.
How to Perform Template Allocation
Demonstrate the steps listed in the Perform Template Allocation exercise.
416
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Duplication is prohibited.
Duplication is prohibited.
You must define a template in which you use the function
ORDER_TARGET_PROCESS_QUANTITY to calculate the actual process quantity. This
function allows the system to calculate target costs of the process on the basis of the current
standard costs.
Unit 10
Exercise 20
375
Perform Template Allocation
Business Example
●
Template allocation
●
Revaluation of activity and process allocation at actual price
●
Overhead surcharge
●
Work in process (WIP) calculation
●
Variance calculation
●
Cost object settlement
Your Controlling department has decided to use the TEMPLATE technique to allocate order
processing costs. Indirect warehousing costs are allocated to the product cost collector using
the costing sheet. After all the actual costs of the current period have been allocated to the
product cost collector, WIP must be calculated at target cost and transferred to Financial
Accounting (FI). During the subsequent variance calculation, period-based variances are
generated according to their causes (variance categories), saved to the order, and later
transferred to FI and CO-PA in detailed variance categories.
Complete the cost allocation process for the product cost collector for material T-FL2##.
Note:
To run the period-end closing transaction, you need the order number of your
product cost collector. If you have not noted the order number, you can find it in
the HEADER data group in the master record of your product cost collector. To
find this, you can use the SAP Fiori app Create Product Cost Collector, which is
also used for updating.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Using the SAP Fiori app Run Template Allocation - Orders Actual, allocate the production
process cost for the current period in current year. Use the following data:
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417
Duplication is prohibited.
Duplication is prohibited.
At the end of the period, all the cost objects are processed in period-end closing, which
consists of the following typical steps:
Unit 10: Period-End Closing for Product Cost Controlling by Period
Field
Value
Order
The order number of your product cost collector (see note above)
Period from
Current Period
Period to
Current Period
Fiscal Year
Current Year
Background Processing
Do not select
Test Run
Do not select
Detail Lists
Select
Messages from Object Selection separate
Do not select
Delete Messages from Object Selection
Do not select
2. From the detailed list display, analyze the costs. You should find cost center activity costs
for Quality Check and Internal Transportation. You can use the function TEMPLATE
TRACE to get details.
3. Check the configuration settings for determining the process template.
What process template is selected for the product cost collector?
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Duplication is prohibited.
418
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Unit 10
Solution 20
377
Perform Template Allocation
Business Example
●
Template allocation
●
Revaluation of activity and process allocation at actual price
●
Overhead surcharge
●
Work in process (WIP) calculation
●
Variance calculation
●
Cost object settlement
Your Controlling department has decided to use the TEMPLATE technique to allocate order
processing costs. Indirect warehousing costs are allocated to the product cost collector using
the costing sheet. After all the actual costs of the current period have been allocated to the
product cost collector, WIP must be calculated at target cost and transferred to Financial
Accounting (FI). During the subsequent variance calculation, period-based variances are
generated according to their causes (variance categories), saved to the order, and later
transferred to FI and CO-PA in detailed variance categories.
Complete the cost allocation process for the product cost collector for material T-FL2##.
Note:
To run the period-end closing transaction, you need the order number of your
product cost collector. If you have not noted the order number, you can find it in
the HEADER data group in the master record of your product cost collector. To
find this, you can use the SAP Fiori app Create Product Cost Collector, which is
also used for updating.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Using the SAP Fiori app Run Template Allocation - Orders Actual, allocate the production
process cost for the current period in current year. Use the following data:
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419
Duplication is prohibited.
Duplication is prohibited.
At the end of the period, all the cost objects are processed in period-end closing, which
consists of the following typical steps:
Unit 10: Period-End Closing for Product Cost Controlling by Period
Field
Value
Order
The order number of your product cost collector (see note above)
Period from
Current Period
Period to
Current Period
Fiscal Year
Current Year
Background Processing
Do not select
Test Run
Do not select
Detail Lists
Select
Messages from Object Selection separate
Do not select
Delete Messages from Object Selection
Do not select
a) On the SAP Fiori Launch Pad, select the app Run Template Allocation - Orders Actual.
b) On the Actual Template Allocation: Order selection screen, enter the data provided in
the table.
c) Choose Execute.
Duplication is prohibited.
a) On the Actual Template Allocation: Order screen, choose More → Go to Template
Trace.
You can expand the list displayed and check the Sender Cost Center and Sender
Activity Type.
3. Check the configuration settings for determining the process template.
What process template is selected for the product cost collector?
The process template S4F25PKOSA is assigned to controlling area A000, costing sheet
1010PC and OH key ZMTO00 and OH key ZMTS00 in the environment 010 (product cost
collector).
a) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Basic Settings for Product Cost by Period →
Templates → Assign Templates to Cost Objects (KTPF).
b) On the Change View “View for Template Determination”: Overview screen, review the
list.
420
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2. From the detailed list display, analyze the costs. You should find cost center activity costs
for Quality Check and Internal Transportation. You can use the function TEMPLATE
TRACE to get details.
Lesson: Performing Template Allocation
LESSON SUMMARY
You should now be able to:
●
Perform template allocation
Duplication is prohibited.
Duplication is prohibited.
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421
Unit 10: Period-End Closing for Product Cost Controlling by Period
Duplication is prohibited.
Duplication is prohibited.
422
© Copyright. All rights reserved.
Unit 10
Lesson 3
381
Performing Revaluation at Actual Prices
LESSON OVERVIEW
This lesson explains how to perform revaluation at actual prices.
Business Example
The cost center management decided to calculate the actual activity prices at the end of each
period for controlling reasons. The actual activity prices can be used for revaluation of the
activity allocation to the cost objects. Because of this, you need an understanding of how to
perform revaluation at actual prices.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
●
Perform revaluation at actual prices
Revaluation at Actual Prices
Duplication is prohibited.
Duplication is prohibited.
Figure 146: Revaluation at Actual Prices (1)
You can determine the actual prices for activity types and business processes at the end of
the period. The actual prices are the actual costs divided by the activity and process actual
quantities consumed. You manage whether revaluation at actual prices is possible in
Customizing. It is based on the parameters for the fiscal year actual version and the master
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423
Unit 10: Period-End Closing for Product Cost Controlling by Period
data of the activity type. You calculate actual prices in Cost-Center-Accounting for actual
activities and Activity-Based-Costing for actual process quantities. Revaluation at actual
prices is performed in the period-end closing process for the product cost collector. The cost
object is credit or debit with the difference between the actual price, and the plan price
originally allocated to it.
You can revaluate activities and business processes at actual prices in the following
components:
●
●
In Cost Object Controlling for all cost objects, such as product cost collectors, production
and process orders, sales order items (if they are being used as cost objects), internal
orders, cost object hierarchies, and general cost objects
In Project System work breakdown structure (WBS) elements, networks, and network
activities
Figure 147: Revaluation at Actual Prices (2)
The example in the figure shows that the planned cost center costs differ from the actual
costs. The price planned is 10.00 per hour. However, only nine hours are allocated instead of
the 10 hours planned in the preliminary costing. At the planned price, this results in 90.00
being allocated to the product cost collector. At the end of the period, the total activity-related
cost at the cost center is determined as 117.00. At nine allocated hours, this results in a target
price of 13.00 per hour, that is, 9 x 13.00 = 117.00 in total. The difference of 27.00 is charged
to the product cost collector with the revaluation at actual prices function.
In this example, revaluation at actual prices is illustrated using an activity type. It also applies
to business processes.
424
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Duplication is prohibited.
Duplication is prohibited.
Revaluation at Actual Prices (2)
Lesson: Performing Revaluation at Actual Prices
LESSON SUMMARY
You should now be able to:
●
Perform revaluation at actual prices
Duplication is prohibited.
Duplication is prohibited.
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425
Unit 10
Lesson 4
383
Performing Actual Overhead Calculation
LESSON OVERVIEW
This lesson explains the process of actual overhead calculation with reference to a product
cost collector.
Business Example:
Overhead costs during the period must take into consideration costs like administration costs
as well as material. Manufacturing overhead will be calculated using a costing sheet. For this
reason, you require the following knowledge:
●
An understanding of how to perform actual overhead calculation
●
Duplication is prohibited.
Duplication is prohibited.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Perform actual overhead calculation
Actual Overhead Calculation
Figure 148: Actual Overhead Calculation
Actual overhead calculation allocates cost to cost objects, which could not calculate as direct
costs. Overhead is allocated to cost objects using quantity-based or percentage allocation
rates. You can simulate overhead allocation with a test run.
The overhead calculation process generates the following posting:
426
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Lesson: Performing Actual Overhead Calculation
●
●
Overhead costs are charged to the cost objects (product cost collectors, manufacturing
orders, sales order item, or general cost objects).
Posting actual overhead cost, an offsetting entry will be posted. The available controlling
objects for the offsetting entry are as follows:
-
Cost Center
-
Internal Order
-
Business Process
The posting is performed using the G/L account with account type secondary cost element.
The cost element is specified in the credit rows in the costing sheet. Actual overhead
calculation uses the costing sheet entered in the product cost collector.
How to Perform Actual Overhead Calculation
Demonstrate the steps listed in the Perform Actual Overhead Calculation exercise.
Duplication is prohibited.
Duplication is prohibited.
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427
Unit 10: Period-End Closing for Product Cost Controlling by Period
Duplication is prohibited.
Duplication is prohibited.
428
© Copyright. All rights reserved.
Unit 10
Exercise 21
385
Perform Actual Overhead Calculation
Business Example
After allocating all direct costs, and allocating indirect costs using TEMPLATE allocation and
revaluation at actual activity prices, you can now calculate the overhead cost based on all
actual costs of the product cost collector.
Your Controlling department has decided to use a costing sheet to calculate the actual
overhead cost and complete the cost of goods manufactured (COGM). Therefore, material
overhead and production overhead will be calculated, but not administrative overhead costs
or distribution costs, which are part of cost of goods sold (COGS). You will calculate COGS in
following exercises.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Calculate for the current period, the actual overhead costs for the product cost collector
of your product T-FL2##. Use the following data:
Field Name or Data Type
Value
Material
T–FL2##
Plant
1010
Period
Current Period
Fiscal Year
Current Fiscal Year
Test Run
Do not select
Detail Lists
Select
Dialog Display
Select
2. From the detailed list display, determine the value of the overhead calculation.
Why did the system not calculate the material overhead cost?
3. Display the configuration settings for determining the overhead costing sheet.
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429
Duplication is prohibited.
Duplication is prohibited.
Calculate the overhead costs for the product cost collector of your product T-FL2## .
Unit 10: Period-End Closing for Product Cost Controlling by Period
Which costing sheet is assigned to the actual costing variant PSRM?
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Duplication is prohibited.
430
© Copyright. All rights reserved.
Unit 10
Solution 21
387
Perform Actual Overhead Calculation
Business Example
After allocating all direct costs, and allocating indirect costs using TEMPLATE allocation and
revaluation at actual activity prices, you can now calculate the overhead cost based on all
actual costs of the product cost collector.
Your Controlling department has decided to use a costing sheet to calculate the actual
overhead cost and complete the cost of goods manufactured (COGM). Therefore, material
overhead and production overhead will be calculated, but not administrative overhead costs
or distribution costs, which are part of cost of goods sold (COGS). You will calculate COGS in
following exercises.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Calculate for the current period, the actual overhead costs for the product cost collector
of your product T-FL2##. Use the following data:
Field Name or Data Type
Value
Material
T–FL2##
Plant
1010
Period
Current Period
Fiscal Year
Current Fiscal Year
Test Run
Do not select
Detail Lists
Select
Dialog Display
Select
a) On the SAP Fiori Launchpad, select the app Run Actual Overhead Calculation (CO42).
b) On the Actual Overhead Calculation: Product Cost Collector selection screen, enter the
data provided in the table.
c) Choose the Execute button.
2. From the detailed list display, determine the value of the overhead calculation.
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431
Duplication is prohibited.
Duplication is prohibited.
Calculate the overhead costs for the product cost collector of your product T-FL2## .
Unit 10: Period-End Closing for Product Cost Controlling by Period
Why did the system not calculate the material overhead cost?
The primary products for T-FL2A## are the clutch (T-FL2A##) and the gear wheel (TFL2B##). Both materials have the material type semi-finished product, while material
overhead is only being calculated on raw material.
a) On the Actual Overhead Calculation: Product Cost Collector Basic List screen, choose
the Next List Level button.
The system displays a value for Production Overhead of 10%.
b) To check the material type, select the SAP Fiori app Material Master — Display Current
(MM03).
c) Enter the material number T-FL2A## and choose Continue.
d) Select the view Basic Data 1 and choose Continue.
e) Choose the Information on Material button.
f) In the Display Material dialog box, you can check the material type.
3. Display the configuration settings for determining the overhead costing sheet.
Which costing sheet is assigned to the actual costing variant PSRM?
Duplication is prohibited.
a) On the SAP Reference IMG (transaction SPRO), choose Controlling → Product Cost
Controlling → Cost Object Controlling → Product Cost by Period → Product Cost
Collectors → Check Costing Variants for Product Cost Collectors → Costing Variants
for Valuation of Internal Activities (OPL1).
b) On the Change View “Costing Variants”: Overview screen, choose Costing variant
PSRM.
c) Choose the Details button.
d) On the Change View “Costing Variants”: Details screen, choose the Valuation Variant
button. The valuation variant 0RM (Repetitive Manufacturing Order Actual) has been
assigned to the costing variant.
e) To view the costing sheet, choose the Details button.
The base for calculation of material overhead is the cost element group 1200_CE,
which contains the cost elements on which goods issue for raw material will be posted.
Semi-finished products use different cost elements. Because no consumption for raw
material has been posted to the production order, no material overhead has been
calculated.
432
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Duplication is prohibited.
The costing sheet 1010PC is assigned to this valuation variant.
Lesson: Performing Actual Overhead Calculation
LESSON SUMMARY
You should now be able to:
●
Perform actual overhead calculation
Duplication is prohibited.
Duplication is prohibited.
© Copyright. All rights reserved.
433
Unit 10
Lesson 5
390
Calculating Work in Process (WIP)
LESSON OVERVIEW
This lesson explains how to calculate work in process (WIP).
Business Example
At the end of a period, the costs for semi-finished goods in the production area must be
calculated and settle to Financial Accounting (FI). For this reason, you require the following
knowledge:
●
An understanding of how to calculate WIP
●
Calculate work in process (WIP)
●
Configure work in process (WIP)
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
Work in Process
Figure 149: WIP at Target Cost
Calculation of WIP means valuating the unfinished goods. In the Product Cost by Period
scenario, the system valuates the WIP at target cost. To do this, the difference of the
confirmed actual quantities (including yield and scrap quantity) between an operation and the
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Lesson: Calculating Work in Process (WIP)
previous operation leads to the actual WIP quantity at the previous operation. The WIP
quantity is multiplied with the calculated cost for all operations up to the operation, the WIP
quantity has been calculated. In Customizing, you can use a valuation variant to define which
cost estimate must be used to calculate the target costs for valuating WIP and the scrap. If
you are using a product cost collector, in many cases it is appropriate to calculate the target
costs using preliminary costing within the product cost collector. When you settle the WIP,
the inventory for unfinished goods will be actualized in Financial Accounting (FI).
How to Calculate Work in Process
Demonstrate the steps listed in the Calculate Work in Process exercise.
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Unit 10: Period-End Closing for Product Cost Controlling by Period
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Unit 10
Exercise 22
393
Calculate Work in Process
Business Example
●
Preliminary cost estimate of the cost object
●
Another material cost estimate
●
The current standard cost estimate of the product
Calculate WIP for your product cost collector.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Using the individual processing transaction, calculate WIP value for your product cost
collector. Use the following data:
Field Name
Value
Material
T—FL2##
Plant
1010
WIP to Period
Current month
Fiscal Year
Current year
RA Version
0
Background Processing
Do not select
Test Run
Do not select
Log Information Messages
Select
Save Log
Do not select
Display Orders with Errors
Select
Displayed Currency
Company Code Currency
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437
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At the end of the period, the allocation of resources to the production process did not lead
completely to finished products. The cost of goods manufactured for those resource costs
are calculated as Work in Process (WIP). Basic are the so called Target Costs. The system
subtracts the confirmed yield quantity of a follow-up operation from the confirmed yield
quantity of the previous confirmed operation, which is the target WIP quantity at the previous
operation. The target WIP quantity is multiplied by a material cost estimate. The valuation
variant for WIP and scrap determines which cost estimate will be selected. Within a priority
list, you can choose the following:
Unit 10: Period-End Closing for Product Cost Controlling by Period
Field Name
Value
Layout
1SAP01
2. From the Calculate Work in Process: Object List screen, access the detailed report by
selecting WIP Explanation.
The report dynamically explodes the costing details for operation 0010. This should reflect
the quantities confirmed for the previous transactions. A yield of 10 pumps was confirmed
for operation 0010. Then, yields of 5 pieces were confirmed for operation 0020, where 1
piece was also reported as scrap. This leaves a remaining WIP quantity of 4 pieces for
operation 0010.
3. Do not cancel the WIP explanation report. Using a different session, display the
preliminary cost estimate for the product cost collector. Change the costing display to 4
pieces to match the WIP quantity.
4. Go to the Itemization report. Change the display variant to view the costs by operations
(grouped). Explode the summation rows for operation 0010. Compare the costs of the
preliminary cost estimate with the calculated WIP costs. They should be identical to
include the process and overhead costs.
5. Compare the preliminary cost estimate for the product cost collector based on 4 PC with
the actual cost of your product cost collector.
Are they the same value? Can you explain this?
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Unit 10
Solution 22
395
Calculate Work in Process
Business Example
●
Preliminary cost estimate of the cost object
●
Another material cost estimate
●
The current standard cost estimate of the product
Calculate WIP for your product cost collector.
Note:
This exercise uses ## as a placeholder. When you see ##, replace it with the
group number that your instructor gave to you.
1. Using the individual processing transaction, calculate WIP value for your product cost
collector. Use the following data:
Field Name
Value
Material
T—FL2##
Plant
1010
WIP to Period
Current month
Fiscal Year
Current year
RA Version
0
Background Processing
Do not select
Test Run
Do not select
Log Information Messages
Select
Save Log
Do not select
Display Orders with Errors
Select
Displayed Currency
Company Code Currency
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439
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Duplication is prohibited.
At the end of the period, the allocation of resources to the production process did not lead
completely to finished products. The cost of goods manufactured for those resource costs
are calculated as Work in Process (WIP). Basic are the so called Target Costs. The system
subtracts the confirmed yield quantity of a follow-up operation from the confirmed yield
quantity of the previous confirmed operation, which is the target WIP quantity at the previous
operation. The target WIP quantity is multiplied by a material cost estimate. The valuation
variant for WIP and scrap determines which cost estimate will be selected. Within a priority
list, you can choose the following:
Unit 10: Period-End Closing for Product Cost Controlling by Period
Field Name
Value
Layout
1SAP01
a) On the SAP Fiori Launch Pad, select the app Calculate Work in Process (KKAS).
b) On the Calculate Work In Process: Individual Processing screen, enter the data
provided in the table.
c) Choose the Execute button.
d) Stay in the app to analyze the WIP result.
2. From the Calculate Work in Process: Object List screen, access the detailed report by
selecting WIP Explanation.
a) On the Calculate Work in Process: Object List screen, choose the WIP Explanation
button.
The report dynamically explodes the costing details for operation 0010. This should reflect
the quantities confirmed for the previous transactions. A yield of 10 pumps was confirmed
for operation 0010. Then, yields of 5 pieces were confirmed for operation 0020, where 1
piece was also reported as scrap. This leaves a remaining WIP quantity of 4 pieces for
operation 0010.
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a) On the SAP Fiori Launch Pad, select the app Create Product Cost Collectors.
b) On the Display Product Cost Collector screen enter the following data, then press
Enter.
Field Name or Data Type
Value
Material
T—FL2##
Plant
1010
c) Select the T-FL2## checkbox, and then choose the Header tab page.
d) Choose the Cost Estimate button.
e) On the Display Material Cost Estimate with Quantity Structure screen, enter the
following data:
Field Name or Data Type
Value
Costs Based On
User Entry
Quantity
4
Unit of quantity
PC
4. Go to the Itemization report. Change the display variant to view the costs by operations
(grouped). Explode the summation rows for operation 0010. Compare the costs of the
preliminary cost estimate with the calculated WIP costs. They should be identical to
include the process and overhead costs.
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3. Do not cancel the WIP explanation report. Using a different session, display the
preliminary cost estimate for the product cost collector. Change the costing display to 4
pieces to match the WIP quantity.
Lesson: Calculating Work in Process (WIP)
a) On the Display Material Cost Estimate with Quantity Structure screen, choose the
Layout button.
b) In the Choose layout dialog box, choose 1SAP06 (Operations Grouped).
Note:
The system displays the operation subtotal. In addition, the overhead cost
(which is not assigned to a specific operation) has been included in the WIP
calculation.
5. Compare the preliminary cost estimate for the product cost collector based on 4 PC with
the actual cost of your product cost collector.
Are they the same value? Can you explain this?
The actual balance of the product cost collector includes the actual cost for WIP as well as
the actual cost for scrap and variances. Therefore, the actual balance of the product cost
collector and the WIP are not equal.
a) Select the SAP Fiori app Analyze Product Cost Collectors.
b) On the Analyze Product Cost Collector: screen, enter the following data:
Field Name or Data Type
Value
Material
T—FL2##
Plant
1010
Time Frame
Cumulated
c) Choose the Execute button. The balance is displayed at the bottom of the report.
Note:
The remaining order balance is not the same as the calculated WIP at
target cost. In the Product Cost by Period scenario, WIP is calculated by
using the actual remaining quantity at the planned cost. For this product
cost collector, a quantity of 10 pieces was confirmed for operation 0100.
Then, 5 pieces yield quantity and 1 piece scrap quantity has been
confirmed for operation 0020. This leaves a remaining WIP quantity of 4
pieces at operation 0010. Those 4 pieces are multiplied by the cost
estimate, which was selected as defined in the valuation variant for WIP
(and scrap) in the Customizing.
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441
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On the Analyze Product Cost Collector: Target/Actual Comparison initial screen, enter
the following data:
Unit 10: Period-End Closing for Product Cost Controlling by Period
Work in Process Settings
Figure 150: Customizing – WIP at Target Cost
Target costs can be calculated on the basis of the following:
●
●
●
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Planned costs calculated in preliminary costing for the manufacturing order, or for the
product cost collector
Based on an alternative material cost estimate (such as a modified standard cost estimate
or an actual cost estimate), defined with costing variant and costing version in the
valuation variant (customizing)
The current standard cost estimate, as released and updated in the material master of the
product
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You specify a valuation variant to choose the cost estimate for valuating WIP and the scrap
variances at target cost.
Lesson: Calculating Work in Process (WIP)
Customizing – Assignment Table
Figure 151: Customizing – Assignment Table
You assign the following cost elements to line IDs:
●
With WIP at target cost, all cost elements in the costing used for calculating target costs
for valuating WIP (such as all cost elements listed in the preliminary cost estimate for the
product cost collector).
You can split the cost of each line item, which consists all cost of the assigned cost
element into the following:
-
Required to be capitalized
-
Option to be capitalized
-
Cannot be capitalized
Local accounting rules determine which splits for WIP cost are allowed or required.
In the following customizing table, UPDATE, you can assign the line IDs and its assigned
costs to different accrual cost elements for WIP - Reporting in CO.
You can mask your entries. The entry 941+++++ includes the cost elements from 94100000
to 94199999. If you want particular cost elements to be treated separately. The opportunity
to mask depends on the Chart of Accounts.
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443
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●
All cost elements with which an order is debited and credited.
Unit 10: Period-End Closing for Product Cost Controlling by Period
Customizing – Update Table
Figure 152: Customizing – Update Table
With a results analysis category, you specify how the results analysis is handled, and the
results analysis cost elements (type 31) posted on the cost object.
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Define Posting Rules for Settling Work in Process
In this step you specify the G/L accounts in Financial Accounting to which the WIP is settled.
You assign a results analysis cost element or a group of results analysis cost elements to two
G/L accounts.
A posting document is generated in Financial Accounting on the basis of the settlement of
work in process. The data is written to the following:
●
Balance Sheet Account
●
Profit & Loss Account
You can assign the results analysis data to the G/L accounts at the following levels:
●
●
Results analysis category. Here you can use WIPR (WIP with requirement to Capitalize),
WIPO (WIP with option to Capitalize) and WIPP (WIP with prohibition to Capitalize).
Results analysis cost elements, as posted in the previous customizing table, UPDATE. This
option enables you to post the WIP amount regarding, for example, material costs, labor
costs, and overhead costs to different G/L accounts.
How to Configure Work in Process
1. Demonstrate the Customizing for RA key.
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You must create line IDs of category K (costs) for valuation-relevant costs, such as direct
material costs. Another line ID category, for example, is N, which relates to costs not to be
included.
Lesson: Calculating Work in Process (WIP)
a) On the SAP Easy Access screen, choose Accounting → Controlling → Product Cost
Controlling → Cost Object Controlling → Product Cost by Period → Master
Data → Product Cost Collector → Edit (KKF6N).
b) On the Display Product Cost Collector screen, select the T-FL2## checkbox and verify
that MBMF03 is entered in the Results Analysis Key field.
c) Choose the Exit button.
d) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Period end closing → Work in
Process → Define Results Analysis Keys.
2. Demonstrate the Customizing for RA version.
a) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Period end closing → Work in
Process → Define Results Analysis Versions.
b) On the Change View “Results Analysis Versions”: Overview screen, choose the row for
COAr A000 and RA version 0.
c) Choose the Detailed Display button.
d) On the Change View “Results Analysis Versions”: Details screen, select the Transfer to
Financial Accounting checkbox.
3. Demonstrate the Customizing for valuation methods for WIP.
a) In Customizing, choose Controlling → Product Cost by Period → Period end
closing → Work in Process → Define Valuation Method (Target Costs).
b) On the Change View “Valuation Method for Work in Process”: Overview screen, choose
the row for CO Area A000 with RA Type WIP Calculation on Basis of Target Costs.
c) Go back to Customizing.
4. Define valuation variants for WIP and scrap.
a) In Customizing, choose Controlling → Product Cost by Period → Period end
closing → Work in Process → Define Valuation Variant for WIP and Scrap (Target
Costs).
b) On the Change View “Valuation Variants for Scrap and WIP”: Details screen, verify that
Plan cost/preliminary CE/Current Std CE appears in the Valuation Variant field.
c) Go back to Customizing.
5. Assign cost elements for WIP and results analysis.
a) In Customizing, choose Controlling → Product Cost by Period → Period end
closing → Work in Process → Define Assignment.
b) On the Change View “Assignment of Cost Elements for WIP and Results Analysis”
screen, verify that the value MAT appears in the ReqToCap column.
c) Go back to Customizing.
6. Define updates for WIP and results analysis calculation.
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e) Go back to Customizing.
Unit 10: Period-End Closing for Product Cost Controlling by Period
a) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Period End Closing → Work in
Process → Define update.
b) On the Change View “Update of WIP Calculation and Results Analysis”: Overview
screen, choose the Position button.
c) In the Another Entry dialog box, enter the following data:
Field Name or Data Type
Value
CO Area
A000
RA Version
0
RA Key
MBMF03
d) Choose the EXIT button.
7. Define posting rules.
a) In Customizing, choose Controlling → Product Cost by Period → Period end
closing → Work in Process → Define Posting Rules for Settling Work in Process.
b) On the Change View “Posting Rules in WIP Calculation and Results Analysis”:0 screen,
choose the row for CO Area A000 and RA Category WIPR.
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Lesson: Calculating Work in Process (WIP)
LESSON SUMMARY
You should now be able to:
●
Calculate work in process (WIP)
●
Configure work in process (WIP)
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447
Unit 10
Lesson 6
402
Performing Variance Calculation
LESSON OVERVIEW
This lesson explains the variance calculation process with reference to the product cost
collector.
Business Example
To verify cost variances the different variance categories must be calculated and settle to FI
and CO-PA. You want to check the variance categories like scrap to take conclusion about the
effectiveness of the production. For this reason, you require the following knowledge:
●
An understanding of how to perform the variance calculation
●
Perform Variance Calculation
●
Configure variance calculation
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LESSON OBJECTIVES
After completing this lesson, you will be able to:
Variance Calculation – Target Version
Figure 153: Variance Calculation – Target Version
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Lesson: Performing Variance Calculation
The target cost versions allow you to calculate variances with different cost comparisons in
parallel. Target version 0 is the version with a standard setting. The target costs are
calculated based on the standard material cost estimate (the so-called standard price), which
has been released in the material master record of the product. Due to the valuation of the
material in Financial Accounting (FI) based on the standard cost estimate, the variance
calculated in target version 0 has to be settled to FI. All other variance calculations are
additional information.
The standard system uses the following target cost versions:
●
Target cost version 0 (total variance):
The total variance equals the order balance. For this version, choose actual costs as the
control costs, and the standard cost estimate as the target costs.
●
Target cost version 1 (production variance):
For this version, choose actual costs as the control costs, and planned costs as the target
costs, which are calculated based on the preliminary cost estimate of the cost object. You
cannot calculate variances on the output side of the cost object, because the valuation of
the material in stock is based on the standard cost estimate for the material, which is not
taken into account in this target version.
●
Target cost version 2 (planning variance):
●
Target cost version 3 (production variance of the period):
You compare the planned costs of the period, calculated on the basis of an alternative
material cost estimate (such as a modified standard cost estimate), with the actual costs
of the period on the basis of the yield delivered to inventory in the period. The base
quantity for the variance calculation is the yield. For this version, choose actual costs as
the control costs, and the alternative material cost estimate as the target costs.
Note:
The definition of target version 0 is fixed, the variances calculated in these
target versions relates to the valuation of material in stock. Besides target
version 3, you can define more target versions like target version 3 for
comparison of alternative production opportunities. Although target version 0
is named “total variances”, it does not mean that the sum of variances
calculated with target version 1 and target version 2 are in total the variances
calculated with target version 0. The name of target version 0 defines the
comparison of Material Cost Estimate against the actual costs of the cost
object.
In the Product Cost by Period scenario, work in process (WIP) and the scrap variances are
always deducted from the actual costs.
The scrap variation is calculated by valuating the unplanned scrap quantities with the target
costs minus the planned scrap costs. The unplanned scrap quantity is the difference between
the actual scrap quantity of the operation and its target scrap quantity. In the variance
calculation, target cost versions are mainly used to control the type of variance (total
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449
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With target cost version 2, the costs in the preliminary order cost estimate are interpreted
as control costs. For this version, choose planned costs as control costs, and the current
standard cost estimate as target costs. You cannot calculate target-actual-variances.
Unit 10: Period-End Closing for Product Cost Controlling by Period
variance, production variance, or planning variance). They can also be used to valuate the
scrap variances.
Figure 154: Variance Calculation – Variance Categories
The following are examples of variance categories:
●
Input price variances:
Raw material 1 was valuated at a price of 10 in the standard cost estimate. When the
material is withdrawn from inventory, the goods movement is valuated at 11. Price control
specifies that valuation is carried out at the moving average price. This results in a price
variance of 1.
●
Input quantity variance:
A machine time of 15 minutes was planned but 17 minutes were confirmed. The activity
price for the machine time is 5 per minute. This results in a quantity variance of 10.
●
Resource-usage variance:
Raw material 2 is used instead of raw material 1. The costs for both raw materials are
reported as resource-usage variances.
●
Remaining input variance:
The material overhead is higher than planned as the price for material 1 is changed. The
difference between the planned and actual material overhead expense is reported as a
remaining input variance.
●
450
Mixed-price variance:
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Variance Calculation – Variance Categories
Lesson: Performing Variance Calculation
If the standard price of a material was calculated using multiple procurement alternatives
(mixed cost estimate), subsequent production without variances will still have a difference
to the standard price. This is the mixed-price variance.
●
Lot size variance:
If another quantity was used for production than previously generated in the product
costing, the fixed costs are adjusted proportionally with another quantity, that is, the fixed
costs per piece change. This is the lot size variance.
●
Output price variance:
The material is transferred to inventory at a price other than the standard price (such as a
moving average price). The difference is determined as an output price variance.
●
Remaining variance:
If the system cannot determine the target costs, it will determine only remaining variances.
This might cause anomalies by rounding up or down the costs.
Figure 155: Addendum – Assembly Scrap and Operation Scrap
A distinction is made between the following types of scrap:
●
Assembly Scrap:
Assembly scrap is the percentage of an assembly that does not meet defined quality
standards. For example, if the assembly scrap rate is 25% and the required yield is 100
units, production must start with 125 units.
●
Operation Scrap:
Operation scrap is the percentage output of an operation that does not meet defined
quality standards. For example, if the operation scrap rate is 20% and the operation
quantity is 125 units, 20% or 25 units will be scrap.
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Addendum – Assembly Scrap and Operation Scrap
Unit 10: Period-End Closing for Product Cost Controlling by Period
Figure 156: Addendum – Planned Scrap
The planned scrap rate reflects the planned material requirements and the planned internal
activities, and is included in the standard cost estimate of the material.
The characteristics of different types of scrap are as follows:
●
●
●
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Component scrap refers to materials that are defaulted before they enter the production
process. Component scrap increases the quantity of input materials. Planned component
scrap is taken into account in the standard cost estimate and, therefore, affects the
standard price. Actual variances are considered as the input quantity variances.
Planned operation scrap is the scrap that is expected to be incurred in an operation.
Assembly scrap can be calculated by the system on the basis of operation scrap.
Assembly scrap increases the planned order quantity and the quantity of the input
materials. For example, if the assembly scrap for a material is 56.25% and you create a
production order for the material with a planned order quantity of 100 units, the system
increases the planned order quantity to 156.25 units. If you do not want the assembly
scrap to affect the input quantities of certain input materials, set the Net indicator in the
bill of material (BOM) for these materials and enter the operation scrap in the BOM.
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Addendum – Planned Scrap
Lesson: Performing Variance Calculation
Figure 157: Variance Calculation – Scrap Variance (1)
The features of the scrap variance are as follows:
●
●
●
●
The scrap variance is the value of the scrap variance quantity.
The scrap variance quantity is the difference between the target scrap quantity (planned
scrap quantity converted to yield) and the actual scrap quantity (confirmed scrap
quantity).
The scrap variance quantity is valuated at target cost reduced by the planned scrap cost.
The formula for calculating the target scrap quantity is 850 units = 80% (yield), 20% scrap
= x. Therefore, (850 x 0.2) / 0.8 = 212.5.
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Variance Calculation – Scrap Variance (1)
Unit 10: Period-End Closing for Product Cost Controlling by Period
Variance Calculation – Scrap Variance (2)
Figure 158: Variance Calculation – Scrap Variance (2)
Variance Calculation – Lot Size Variance
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Figure 159: Variance Calculation – Lot Size Variance
Lot size variances can be calculated for all the target cost versions that report variances on
the output side.
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Lesson: Performing Variance Calculation
Lot size variances are calculated as follows: lot size variance = lot-size-independent target
costs x (1 - control quantity / planned quantity).
Lot size variances are only calculated if the planned quantity is not equal to the confirmed
quantity (the delivered quantity).
In the example provided in the figure, the costs that are independent of the lot size (such as
the setup and teardown costs) are 40.00 per unit.
The standard price for a finished product as calculated in the standard cost estimate is
120.00. The costs for 10 units of finished product delivered to inventory in the period were
updated to the product cost collector. The actual cost is 840.00. The goods receipts are
valuated at 1200.00 (quantity delivered to inventory multiplied by the standard price as
calculated in the standard cost estimate). The target costs, however, are 10 x 40.00 for
materials, 10x 40.00 for internal activities, and 1 x 40.00 for setup, which is equal to 840.00.
The difference between the target costs and credit is the lot size variance.
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Variance Calculation – Mixed-Price Variance
Figure 160: Variance Calculation – Mixed-Price Variance
If you want to perform mixed costing in Product Cost Planning, you must create a
procurement alternative for each production version and then define a mixing ratio. The
mixed cost estimate calculates a mixed price. This price can be written to the material master
as the standard price.
Mixed-price variances arise when the system updates the mixed price as the standard price in
the material master, and valuates the stock with it. The mixed-price variance results from the
difference between the target credit (actual quantity x standard cost of procurement
alternative) determined in the variance calculation process, and the actual credit posted at
the time of the goods receipt (actual quantity x standard price). If you do not activate the
mixed-price variance field in the variance variant, mixed-price variances are reported as
output price variances.
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Unit 10: Period-End Closing for Product Cost Controlling by Period
How to Perform Variance Calculation
Show the calculation of variances for your product cost collectors. Refer to the exercise for
that topic.
In the previous exercises, for the material T-FL2## has been produced with 1 PC of scrap.
Additionally, the actual quantity for the material T-FL2A## within posting the goods issue was
higher than planned. Therefore the variance calculation will calculate such variance
categories.
Explain the results. Explain, that in the BOM and the routing of the material T-FL2## no plan
scrap values has been maintained. Because of this, the confirmed scrap quantity is also scrap
quantity variance.
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Unit 10
Exercise 23
411
Execute Variance Calculation
In the previous exercises, you posted a goods issue for material T-FL2A## with 1 PC more
than required, depending on the BOM. This leads to a quantity variance. In the confirmation,
you posted 1 PC of scrap, which leads to a scrap variance.
You want to calculate and analyze variances and the different variance categories.
1. Calculate the variance using the app Run Variance Calculation — Product Cost Collector.
Use the following data:
Field Name or Data Type
Value
Material
T-FL2##
Plant
1010
Period
Current period
Fiscal Year
Current year
Test Run
Do not select
Detail List
Select
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All Tgt Cost Vsns (All Target Cost Versions) Select
457
Unit 10
Solution 23
412
Execute Variance Calculation
In the previous exercises, you posted a goods issue for material T-FL2A## with 1 PC more
than required, depending on the BOM. This leads to a quantity variance. In the confirmation,
you posted 1 PC of scrap, which leads to a scrap variance.
You want to calculate and analyze variances and the different variance categories.
Field Name or Data Type
Value
Material
T-FL2##
Plant
1010
Period
Current period
Fiscal Year
Current year
All Tgt Cost Vsns (All Target Cost Versions) Select
Test Run
Do not select
Detail List
Select
a) On the SAP Fiori Launch Pad, select the app Run Variance Calculation — Product Cost
Collector.
b) On the Variance Calculation: Initial screen, enter the data provided in the table.
c) Choose Execute to run the transaction.
d) On the Variance Calculation: List, choose Cost Element.
In the Variance Calculation: List, you can see the calculated variances for each item
with the calculated amounts for WIP, scrap and variances.
e) Position your cursor on the item for material T-FL2A## and choose Variances.
f) Verify the amounts that were calculated for the different variance categories.
You find the variance calculated with category Input Quantity Variances, which refers
to the goods issue you posted in a previous exercise.
g) To analyze the calculated scrap variance, choose Information Scrap (Explanation of
Scrap).
h) Verify that the scrap variance was calculated by multiplying the confirmed scrap
quantity by the cost estimate for that scrap quantity, including all operations and
material costs.
458
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Duplication is prohibited.
Duplication is prohibited.
1. Calculate the variance using the app Run Variance Calculation — Product Cost Collector.
Use the following data:
Lesson: Performing Variance Calculation
Note:
You confirmed the scrap quantity at the second operation. Because of this,
the cost estimate for the first and second operation was taken into
account. If the confirmation of the scrap quantity was confirmed at the first
operation, only the cost estimate for the first operation would be
considered.
Note:
Additionally, you might detect price variances. The reasons could be:
●
●
Different costing variants and valuation variants and therefore the
selection of different prices.
Different activity type prices for each period and therefore a difference
between the average activity type price used in the material cost
estimate and the period activity type price selected for the activity
allocation within the confirmation.
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Duplication is prohibited.
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459
Unit 10: Period-End Closing for Product Cost Controlling by Period
Figure 161: Customizing for Variance Calculation
You always enter the valuation variant for scrap in target cost version 0. If you calculate
variances in a different target cost version (such as target cost version 1), the scrap variance
may be valuated with the valuation variant specified in target cost version 0.
You normally use the same valuation variant for valuating WIP at target cost, and for valuating
scrap variances.
In the variance variant, you specify which variance categories you want the system to report
on. You link the variance variant to the target cost version.
Variances can only be calculated on a cost object if you have stored a variance key in its
master record. You specify the variance key in the costing view of the material master record.
The variance key is transferred from there to the product cost collector (in the Product Cost
by Order scenario, it is transferred to the manufacturing order). You can specify the variance
key as a plant-based default value in Customizing for Product Cost by Period or Product Cost
by Order. The variance key is then transferred to all material master records created in the
plant in question.
How to Configure Variance Calculation
Please be aware that ## stands for your group-number like 01, 02, ...
1. Edit the product cost collector.
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Duplication is prohibited.
Duplication is prohibited.
Variance – Calculation Settings
Lesson: Performing Variance Calculation
a) On the SAP Easy Access screen, choose Accounting → Controlling → Product Cost
Controlling → Cost Object Controlling → Product Cost by Period → Master Data →
Product Cost Collector → Edit (KKF6N).
b) On the Display Product Cost Collector screen, select the T-FL2## checkbox.
c) Press Enter.
d) Choose the Exit button.
2. Define variance keys.
a) Execute transaction SPRO.
b) In Customizing, choose Controlling → Product Cost Controlling → Cost Object
Controlling → Product Cost by Period → Period end closing → Variance
Calculation → Variance Calculation for Product Cost Collectors → Define Variance
Keys.
c) On the Change View "Variance Keys": Overview screen, choose the row for variance key
000001.
d) Choose the Execute button.
e) Go back to Customizing.
a) In Customizing, choose Product Cost by Period → Period end closing → Variance
Calculation → Variance Calculation for Product Cost Collectors → Define Variance
Variants.
b) On the Change View “Variance Keys”: Details screen, verify that the Minor Difference
field is empty.
c) Go back to Customizing.
4. Display the valuation variant.
a) In Customizing, choose Product Cost by Period → Period end closing → Variance
Calculation → Variance Calculation for Product Cost Collectors → Define
Valuation Variant for WIP and Scrap (Target Costs).
b) Go back to Customizing.
5. Define the target costs versions.
a) In Customizing, choose Product Cost by Period → Period end closing → Variance
Calculation → Variance Calculation for Product Cost Collectors → Define Target Costs
Versions.
b) On the Change View “Target Costs Versions”: Overview screen, choose the row IDES
Europe.
c) Choose the Execute button.
d) Go back to the previous screen.
e) On the Change View “Target Costs Versions”: Overview screen, choose the Variances
from production row.
f) Choose the Execute button.
The system displays the View “Target Costs Versions”: Details screen.
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461
Duplication is prohibited.
Duplication is prohibited.
3. Define variance variants.
Unit 10: Period-End Closing for Product Cost Controlling by Period
Duplication is prohibited.
Duplication is prohibited.
462
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Lesson: Performing Variance Calculation
LESSON SUMMARY
You should now be able to:
●
Perform Variance Calculation
●
Configure variance calculation
Duplication is prohibited.
Duplication is prohibited.
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463
Unit 10
Lesson 7
416
Performing Settlement
LESSON OVERVIEW
This lesson explains how to perform settlement of product cost collectors.
Business Example
To inform the Financial Accounting about price differences in total and variance categories in
detail as well as the value of semi-finished products (Work in Process), you must settle the
calculated Work in process, price difference and variance categories to Financial Accounting
and Controlling Profitability Analysis (CO-PA). For this reason, you require the following
knowledge:
●
An understanding of how to perform settlement
Duplication is prohibited.
●
Duplication is prohibited.
LESSON OBJECTIVES
After completing this lesson, you will be able to:
Perform Settlement
Settlement
Figure 162: Settlement
464
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Lesson: Performing Settlement
The settlement process for product cost collectors is as follows:
●
●
●
●
●
●
Settlement is initiated to debit the price difference account and credits the inventory
change account if the price control indicator is set to S.
Settlement is initiated to debit the inventory account and credit the inventory change
account if the price control indicator is set to V. The value of the total variance is posted.
Settlement is initiated to transfer work in process (WIP) to Financial Accounting (FI).
The system updates the value of the total variance in the Material Ledger, which is
mandatory in SAP S/4HANA.
The variance categories can be settled to costing-based CO-PA. The only variances that
are relevant for settlement to CO-PA are those calculated on the basis of target cost
version 0. The value fields are assigned in Customizing to the variances for each category
and cost elements.
The price difference is settled to CO-PA, if it is active, in a similar way to FI if the price
difference account has a corresponding cost element.
Note:
In SAP S/4HANA it is possible, to assign the variance categories to different G/L
accounts. Therefore, the variance categories like scrap variance could be analyzed
in FI and CO-PA Account-based. You use a Price Difference Splitting Profile in
Customizing FI for that.
Duplication is prohibited.
Duplication is prohibited.
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465
Unit 10: Period-End Closing for Product Cost Controlling by Period
Facilitator
Producer
Say:
-
-
"We're going to break into groups of 3
people to discuss and complete the following activity".
Do:
-
-
"You will have 15 minutes to work together in the breakout rooms and then we'll
meet together in the main classroom".
-
Do:
-
-
-
-
466
-
Assist the instructor by moving between
the various breakout rooms and answering questions regarding the technology
and questions to be discussed.
If desired, archive the individual breakout
room chat and whiteboard pods for immediate discussion in the main classroom and for later reference or distribution.
Broadcast announcements to everyone.
For example, give a two-minute warning
prior to the end of the breakouts.
Describe how to use the audio sub-conferences and refer to this content in the
Participant Handbook.
Duplication is prohibited.
Duplication is prohibited.
-
Collect the required demographic information, such as job role, prior experience
with the application, and so on, in order
to assign participants to groups.
Assign participants to breakout rooms.
Advise participants about how to contact
the instructor while in the breakout
rooms (that is, private chat and instant
messaging).
Debrief by asking several groups to answer the question and stop when groups
start repeating what was expressed by
other groups.
Remind students to participate actively
in the class discussion, noting information of interest in their Participant Handbook.
© Copyright. All rights reserved.
Lesson: Performing Settlement
INTERACTIVE ELEMENT: Breakout Rooms
1. Explain the various settlements to CO-PA according to variance categories.
.
.
.
.
.
.
.
.
.
.
Customizing – Settlement Profile
Duplication is prohibited.
Duplication is prohibited.
Figure 163: Customizing – Settlement Profile
The settlement profile for a product cost collector must allow settlement to a material.
If you want to settle variances to CO-PA, the variances indicator must be selected and
settlement to a profitability segment must be allowed.
The settlement profile is defaulted through the order type of the product cost collector. The
settlement profile defines the proposal for the allocation structure and the CO-PA transfer
structure. An allocation structure is used for settling the price differences to FI and CO-PA,
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467
Unit 10: Period-End Closing for Product Cost Controlling by Period
whereby the actual data for both modules are updated in the table ACDOCA. The G/L account
for price difference (PRD) is selected from the account assignment, transaction OMWB. On the
other hand, the variance categories could be assigned to different G/L accounts using the
price difference splitting profile in customizing FI, navigation via: Customizing → Financial
Accounting → General Leger Accounting → Periodic Processing → Integration → Material
Management → Define Accounts for Splitting Price Differences.
The PA transfer structure controls the settlement of the variance categories to costing-based
CO-PA.
Note:
With the settlement of the variances to FI and CO-PA, the variances will be posted
to CO-PA costing based twice: once in total and once by category. The settlement
to FI will be to a G/L account with the account type primary cost element.
Duplication is prohibited.
Duplication is prohibited.
Customizing – PA Transfer Structure
Figure 164: Customizing – PA Transfer Structure
In the PA transfer structure, you specify the assignment of the cost elements plus variance
category to the value fields in costing-based CO-PA. The assignment can be defined different
according to:
●
●
468
Different cost elements of one variance category to different value fields, for example the
material cost and the activity cost with variance category Input Quantity Variance are
assigned to different value fields.
Different variance categories of the same cost element are assigned to different value
fields, for example the Input Quantity Variance and the Input Price Variance of the material
costs are assigned to different value fields.
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Lesson: Performing Settlement
●
Using the fixed/variable indicator, you can assign the fixed cost and the variable cost of
one variance category to different value fields.
On the other hand, the detailed analysis of variances usually takes place in the information
system of the cost object controlling and not in CO-PA.
Settlement of the variances to CO-PA account—based
The settlement of the variances to CO-PA account-based relates to
●
●
the price difference account, selected based on the Account Assignment for Automatic
Posting transaction OMWB and
the settlement of the different variance categories to FI and CO-PA account–based using a
Price Differences Splitting Profile.
To settle the variance categories to FI and CO-PA account-based, a Price Differences Splitting
Profile must be created in customizing FI. The price differences splitting profile defines the
assignment of Cost Element Group + Variance Category to Target Account. For one target
account, the default indicator must be set. You can find the Price Differences Splitting Profile
in Customizing Transaction SPRO → Financial Accounting → General Ledger Accounting →
Periodic Processing → Integration → Materials Management → Define Accounts for Splitting
Price Differences.
While it is possible to distinguish between fixed and variable costs in the variance categories
in CO-PA costing-based, this is not possible in FI and CO-PA account-based.
How to Perform Settlement
Display the settlement rule of the Product Cost Collector. Go to the settlement parameters
and explain the settlement profile and PA transfer structure for settlement to COPA Costingbased. Refer to the exercise for settlement WIP and variances of the product cost collector.
Note:
Because of using the splitting profile for splitting the variances to FI, the variances
are posted double in the FI document. On one hand, the consolidated amount PRD
(Price Difference), and on the other hand, the splitting of this PRD is in the FI
document.
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469
Duplication is prohibited.
Duplication is prohibited.
The system selects the price difference account from the Automatic Posting according to
transaction type = PRD, chart of accounts from the corresponding company code, the general
modification (option) and the account class assigned in the material master. The cost element
for price difference debit the cost object. In the Financial Accounting (FI) and in CO-PA
account-based, the price difference is posted with debit and credit. The reason for debit and
credit posting is the fact, that the loss for price differences (or probably positive variance) has
already been realized in FI.
Unit 10: Period-End Closing for Product Cost Controlling by Period
Note:
Because of settlement to FI and COPA Costing-based in parallel, the variances are
settled to COPA Costing-based twice. One settlement comes from FI, because the
G/L account has the account type Primary Cost and the account assignment is
COPA. The second settlement to COPA Costing-based depends on the PA
Transfer structure. Because the variances settlement is using the Price Difference
Splitting Profile, the settlement to CO-PA account based contains the same
different variance categories like the settlement to CO-PA costing based.
Duplication is prohibited.
Duplication is prohibited.
470
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Unit 10
Exercise 24
421
Execute the Settlement of WIP and Variances
for the Product Cost Collector
In your product cost by period scenario, you posted the goods issue, confirmation, and goods
receipt. You executed the calculation of WIP and variances of the current period. Now, you
want to settle WIP and variances of the current period and check the Customizing for the
settlement.
1. Check the Customizing for the settlement of the product cost collector using the app Run
Actual Settlement — Product Cost Collectors. Check the settlement profile YBMFP1, the
allocation structure, and PA transfer structure assigned to the settlement profile.
Is Profitability Segment a valid optional receiver?
Duplication is prohibited.
Duplication is prohibited.
Is the settlement of the variances to costing-based PA scheduled?
What is the allocation structure?
What is the PA transfer structure?
Check the following statements:
●
●
Settlement Profile: Allows receiver types, proposal for Allocation Structure, Source
Structure and CO-PA Transfer Structure.
Allocation Structure: Assign the cost elements used from the cost object to settlement
cost element, or keep the cost element from the cost object for the settlement posting.
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471
Unit 10: Period-End Closing for Product Cost Controlling by Period
●
●
Source Structure: Assignment of cost elements to position number in the source
structure. The source structure is not used here, because you assign the cost elements
directly to settlement cost elements respectively value fields in the allocation structure
and CO-PA transfer structure.
CO-PA Transfer Structure: Assignment of cost elements to CO-PA costing based:
Assignment of the cost elements + variance category + fix/variable indicator to value
fields.
Field Name or Data Type
Value
Material
T—FL2##
Plant
1010
Settlement Period
Current period
Fiscal Year
Current year
Background Processing
Do not select
Test Run
Do not select
Detail List
Select
Check Trans. Data
Don’t select
Execute the settlement and verify the documents choosing the function Detail List.
472
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Duplication is prohibited.
Duplication is prohibited.
2. Perform settlement of your product cost collector. On the
Actual Settlement: Product Cost Collector selection screen, enter the following data:
Unit 10
Solution 24
423
Execute the Settlement of WIP and Variances
for the Product Cost Collector
In your product cost by period scenario, you posted the goods issue, confirmation, and goods
receipt. You executed the calculation of WIP and variances of the current period. Now, you
want to settle WIP and variances of the current period and check the Customizing for the
settlement.
1. Check the Customizing for the settlement of the product cost collector using the app Run
Actual Settlement — Product Cost Collectors. Check the settlement profile YBMFP1, the
allocation structure, and PA transfer structure assigned to the settlement profile.
Is the settlement of the variances to costing-based PA scheduled?
Duplication is prohibited.
Duplication is prohibited.
Is Profitability Segment a valid optional receiver?
What is the allocation structure?
What is the PA transfer structure?
Check the following statements:
●
●
●
Settlement Profile: Allows receiver types, proposal for Allocation Structure, Source
Structure and CO-PA Transfer Structure.
Allocation Structure: Assign the cost elements used from the cost object to settlement
cost element, or keep the cost element from the cost object for the settlement posting.
Source Structure: Assignment of cost elements to position number in the source
structure. The source structure is not used here, because you assign the cost elements
directly to settlement cost elements respectively value fields in the allocation structure
and CO-PA transfer structure.
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473
Unit 10: Period-End Closing for Product Cost Controlling by Period
●
CO-PA Transfer Structure: Assignment of cost elements to CO-PA costing based:
Assignment of the cost elements + variance category + fix/variable indicator to value
fields.
a) On the SAP Fiori launch pad, select the app Run Actual Settlement - Product Cost
Collectors.
b) In the Actual Settlement: Product Cost Collector screen, choose More →
Environment → Customize Settlement.
c) In the Settlement: Initial Screen, select Settlement Profile and choose the Choose
button.
d) In the Change View "Settlement Profile": Overview screen, select the settlement profile
YBMFP1 and choose Details.
e) In the Change View "Settlement Profile": Details screen, verify the following
information:
●
The settlement of the variances to costing-based PA is scheduled.
●
Profitability Segment is a valid optional receiver.
●
The assigned allocation structure is YP.
●
The assigned PA transfer structure is E1.
f) Go back to the Actual Settlement: Product Cost Collector screen.
Duplication is prohibited.
Field Name or Data Type
Value
Material
T—FL2##
Plant
1010
Settlement Period
Current period
Fiscal Year
Current year
Background Processing
Do not select
Test Run
Do not select
Detail List
Select
Check Trans. Data
Don’t select
Execute the settlement and verify the documents choosing the function Detail List.
a) On the Actual Settlement: Product Cost Collector screen, enter the data provided in the
table.
b) Choose Execute.
c) Choose Detail Lists.
d) Go to the Accounting Documents and explain the following documents:
474
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Duplication is prohibited.
2. Perform settlement of your product cost collector. On the
Actual Settlement: Product Cost Collector selection screen, enter the following data:
Lesson: Performing Settlement
●
Accounting Document
●
Controlling Document
●
Profitability Analysis Document
Note:
Because the settlement to FI and COPA Costing-based is done in
parallel, the variances are settled to COPA Costing-based twice. One
settlement comes from FI, because the G/L account has the account
type Primary Cost and the account assignment is COPA. The second
settlement to COPA Costing-based depends on the PA Transfer
structure. Because the variances settlement uses the Price Difference
Splitting Profile, the direct settlement to COPA Costing-based is not
necessary.
Duplication is prohibited.
Duplication is prohibited.
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475
Unit 10: Period-End Closing for Product Cost Controlling by Period
LESSON SUMMARY
You should now be able to:
●
Perform Settlement
Duplication is prohibited.
Duplication is prohibited.
476
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Unit 10
427
Learning Assessment
1. Which of the following is a function of the product cost collector?
Choose the correct answer.
X
A Material ledger preparation
X
B Profitability forecast reporting
X
C Overhead removal plan preparation
X
D Work in process (WIP) calculation
2. Which of the following functions investigates the causes of the order’s balance?
X
A Variance calculation
X
B Cost Center Accounting
X
C Work in process (WIP) calculation
X
D Overhead allocation
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answer.
3. To which of the following objects do you assign a TEMPLATE?
Choose the correct answers.
X
A Controlling Area
X
B Costing Sheet
X
C Overhead Key
X
D Environment
X
E Company Code
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477
Unit 10: Learning Assessment
4. The use of product cost collectors improves the performance of period-end closing
activities, such as revaluating activities. This is because the number of cost objects is
lower than the product costs per order.
Determine whether this statement is true or false.
X
True
X
False
5. Revaluating activity prices can be used to support the valuation strategy "Actual activity
price of previous period".
Determine whether this statement is true or false.
X
True
X
False
6. Revaluating actual prices follows the allocation of process costs and overhead costs.
X
True
X
False
7. The costing sheet to calculate overhead cost is assigned to which of the following?
Choose the correct answer.
X
A Valuation variant
X
B Costing variant
X
C Order type
X
D Controlling area
8. Which of the following statements is true about work in process (WIP)?
Choose the correct answer.
478
X
A Calculating WIP means valuating the unfinished goods.
X
B Calculating WIP means valuating the finished goods.
X
C Calculating WIP means valuating the raw material.
X
D Calculating WIP means valuating the goods that are completed and delivered.
© Copyright. All rights reserved.
Duplication is prohibited.
Duplication is prohibited.
Determine whether this statement is true or false.
Unit 10: Learning Assessment
9. Variances can only be calculated on a cost object if you have stored a variance key in its
master record.
Determine whether this statement is true or false.
X
True
X
False
10. Which of the following are necessary to perform mixed costing in product cost planning?
Choose the correct answers.
X
A Create a procurement alternative for each production version
X
B Define a mixing ratio
X
C Have a separate material master for mixed prices
X
D Variance key
11. In the settlement profile, which of the following settings are needed to enable variances to
be settled to Profitability Analysis (CO-PA)?
X
A Variances indicator must be selected.
X
B Profitability segment must be allowed.
X
C Material must be allowed.
X
D Cost center must be allowed.
© Copyright. All rights reserved.
Duplication is prohibited.
Duplication is prohibited.
Choose the correct answers.
479
Unit 10
430
Learning Assessment - Answers
1. Which of the following is a function of the product cost collector?
Choose the correct answer.
X
A Material ledger preparation
X
B Profitability forecast reporting
X
C Overhead removal plan preparation
X
D Work in process (WIP) calculation
Correct. The product cost collector can be used for work in process (WIP) calculation.
Duplication is prohibited.
Choose the correct answer.
X
A Variance calculation
X
B Cost Center Accounting
X
C Work in process (WIP) calculation
X
D Overhead allocation
Correct. The variance calculation is executed in order to identify the cause for balances to
have occurred on the order.
3. To which of the following objects do you assign a TEMPLATE?
Choose the correct answers.
X
A Controlling Area
X
B Costing Sheet
X
C Overhead Key
X
D Environment
X
E Company Code
Correct. It can be assigned directly at all levels given, except for the company code.
480
© Copyright. All rights reserved.
Duplication is prohibited.
2. Which of the following functions investigates the causes of the order’s balance?
Unit 10: Learning Assessment - Answers
4. The use of product cost collectors improves the performance of period-end closing
activities, such as revaluating activities. This is because the number of cost objects is
lower than the product costs per order.
Determine whether this statement is true or false.
X
True
X
False
Correct. It is indeed faster as there are fewer cost objects.
5. Revaluating activity prices can be used to support the valuation strategy "Actual activity
price of previous period".
Determine whether this statement is true or false.
X
True
X
False
Correct. "Actual activity price of previous period" is dependent on the revaluation of
activity prices.
6. Revaluating actual prices follows the allocation of process costs and overhead costs.
X
True
X
False
Correct. Allocations are the final steps.
7. The costing sheet to calculate overhead cost is assigned to which of the following?
Choose the correct answer.
X
A Valuation variant
X
B Costing variant
X
C Order type
X
D Controlling area
Correct. It is assigned to the valuation variant.
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481
Duplication is prohibited.
Duplication is prohibited.
Determine whether this statement is true or false.
Unit 10: Learning Assessment - Answers
8. Which of the following statements is true about work in process (WIP)?
Choose the correct answer.
X
A Calculating WIP means valuating the unfinished goods.
X
B Calculating WIP means valuating the finished goods.
X
C Calculating WIP means valuating the raw material.
X
D Calculating WIP means valuating the goods that are completed and delivered.
Correct. WIP is calculated for unfinished goods.
9. Variances can only be calculated on a cost object if you have stored a variance key in its
master record.
Determine whether this statement is true or false.
X
True
X
False
Correct. Maintaining the variance key is a firm prerequisite.
10. Which of the following are necessary to perform mixed costing in product cost planning?
Duplication is prohibited.
X
A Create a procurement alternative for each production version
X
B Define a mixing ratio
X
C Have a separate material master for mixed prices
X
D Variance key
Correct. You must create a procurement alternative for each production version and
define a mixing ratio as well.
11. In the settlement profile, which of the following settings are needed to enable variances to
be settled to Profitability Analysis (CO-PA)?
Choose the correct answers.
X
A Variances indicator must be selected.
X
B Profitability segment must be allowed.
X
C Material must be allowed.
X
D Cost center must be allowed.
Correct. You must have allowed variances and of course the profitability segment must be
defined as a valid receiver.
482
© Copyright. All rights reserved.
Duplication is prohibited.
Choose the correct answers.